Finance Minister
Heng Swee Keat delivered his first Budget on Thursday (24 March). The final measures offered were muted for large firms and multinational corporations with most measures aimed at SMEs.
The first measure introduced for this year’s Budget was an extension of the Special Employment Credit (SEC) Scheme. Originally due to expire this year, the program will now run until 2019.
Employers who hire staff aged over 55 years who earn up to $4,000 will receive the following wage offsets:
- Up to 8% for workers over 65 years
- Up to 5% for workers between 60 and 64 years
- Up to 3% for workers between 55 and 59 years
In addition to this, firms will still receive a wage offset of 3% for the re-employment of workers aged 65 years and above. This will remain until the re-employment age is raised in 2017.
The SEC Scheme will cover 340,000 (or about 75%) of older Singaporean workers, Heng said.
The Budget also provided new incentives for firms to hire more disabled workers, offering a 16% wage offset for firms who hired disabled staff earning up to $4,000 per month.
Although many experts predicted the cessation of proposed foreign worker levy hikes, this year’s Budget didn’t quite deliver as hoped. Only the marine and process sectors will have their levy increases deferred by one year due to challenging business conditions in those industries.
Continuing along the government’s drive for added productivity, the Budget also introduced the new Automation Support Package to help firms become more manpower efficient. As well as supporting the roll out or scaling up of automation projects, the package also included a 100% Investment Allowance for automation equipment.
The launch of the Ministry of Manpower’s (MOM’s) new Adapt & Grow Program was also mentioned with expanded wage support schemes to encourage business to hire additional staff.
Finally, Heng talked about the Business and IPC Partnership program – a pilot program focusing on corporate responsibility initiatives for firms. Within this, companies that organise for employees to volunteer at Institutions of a Public Character (IPC) will be offered a tax deduction of 250% for all associated costs. This deduction will be capped at $250,000 per business.
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Government may abolish foreign worker levy hikes
