How businesses will be backed as part of the Singapore Budget 2020

1. Workers

   Targeted assistance is rolled out to the five sectors namely, hotels, tourism, aviation, retail and food services that are adversely affected by COVID-19 breakout. The support provided under Adapt and Grow initiative has been enhanced from three months to six months for the Place and Train (PnT) programmes in retail and hotel industry to help workers to be re-skilled and up-skilled. Additionally, workforce Singapore WSG will provide new PnT programmes and Professional Conversion Programme (PMP) for targeted sectors.

2. Tourism

   Eligible enterprises in the tourism sector can borrow up to $1 million, with the interest rate capped at 5% p.a., from Participating Financial Institutions under the new Temporary Bridging Loan Programme (TBLP). The TBLP will be available until March 2021, and the government will provide 80% risk-share on these loans.

3. Aviation

   In the aviation sector the airlines that had operated scheduled passenger flights between mainland China and Singapore before the COVID-19 outbreak will be given landing credits and those airlines that continue to operate scheduled flight along the route will be given 100% rebate on the landing charges. Furthermore, to help airlines and cargo agents defray their operating costs, rebates on parking and landing charges as well as regulatory fees charged on airworthiness certificate along with a six-month waiver of the planned annual increase of landing, parking and aerobridge (LPA) charges have been announced. The retailers, F&B operators and other stakeholders operating at the Changi airport will benefit from assistance such as rental rebates.

4. Maritime

   Cruise ships and regional ferries with a port stay of not more than five days, and passenger-carrying harbour craft will benefit from the 50% port dues concession provided by the Maritime and Ports Authority of Singapore (MPA).

5. Hawkers and Commercial Tenants

   National Environment Agency (NEA) will provide a one-month rental waiver, a minimum of S$200 to stallholders in NEA hawker centres and markets.   Likewise, eligible commercial tenants/lessees in government facilities will be given half a month’s worth of rental waiver.

6. Property Tax Rebate

   Accommodation and function room components of hotel buildings, serviced apartment buildings; Meetings, Incentive, Conferences and Events (“MICE”) venues, and other qualifying commercial properties will receive a 30% rebate on property tax payable. Qualifying commercial properties such as premises of an international airport, international cruise or regional ferry terminal, shops within hotel buildings, serviced apartment buildings, and the prescribed MICE venues will be given a 15% rebate on property tax payable. The two integrated resorts will receive a 10% property tax rebate.

1. Measures focusing on Jobs and wages

   Under the Jobs Support Scheme (JSS),  as a temporary measure employers will receive an 8% cash grant on the gross monthly wages of each local employee (applicable to Singapore Citizens and Permanent Residents only) for October 2019 to December 2019, subject to a monthly wage cap of $3,600 per employee. The grant will be awarded automatically by the Inland Revenue Authority of Singapore (IRAS) to employers based on the CPF data.

   The level of co-funding by the government under the Wage Credit Scheme (WCS) has been increased to 20% and 15% (from existing 15% and 10%) for the years 2019 and 2020, respectively. The gross monthly wage ceiling is also increased from S$4,000 to S$5,000.

2. Measures to Improve Cash Flow

   A 25% rebate on corporate income tax payable, capped at S$15,000 will be given for the Year of Assessment (YA) 2020.

   An additional two months of interest-free instalments for payment of corporate income tax will be given to companies that file their Estimated Chargeable Income (ECI) within three months from the companies’ financial year-end (FYE).

   Capital allowances against capital expenditure incurred for acquisition of Plant and Machinery (P&M) will be allowed to be claimed over an accelerated period of two years instead of the present claimable period of three years or the working life of the P&M. Likewise, expenses incurred on renovation and refurbishments (R&R) during the FY2020, can now be deducted in one YA instead of the current provision of deduction over three consecutive YAs following the basis period.

   Instead of one year that is presently allowed under the carry-back relief scheme, the unabsorbed capital allowance and trade losses for YA2020 will be allowed to be carried back up to three immediate preceding YAs.

   The maximum loan quantum available under Enterprise Financing Scheme – SME Working Capital Loan (EFS-WCL) will be increased from $300,000 to $600,000, the Government’s risk-share under the scheme will be increased to 80% (from the current 50% to 70%). The scheme will be available from March 2020 to March 2021.

Enhancements to Startup SG Equity

Recognising the long gestation period and huge investments needed for deep-tech startups and the dearth of patient capital,  S$300 million has been committed to promoting private investments into deep-tech startups in critical sectors such as pharmbio and medtech, advanced manufacturing, and agri-food tech. The Government may partner with qualified third-party investors to make direct co-investments into eligible startups, or invest in funds through a fund-of-funds approach.

1. Launch of GoBusiness and e-Adviser

   The GoBusiness platform is a central platform that streamlines and digitalises transactions between the government and businesses. Following a pilot programme in October 2019 for food services sector licensing, the portal is now being made permanent and will be expanded to cover more sectors and government agencies. Access to government assistance programmes will be streamlined, and e-Adviser will recommend the ideal assistance based on the individual needs of the businesses.

2. Expansion of SMEs Go Digital Programme

   The Go Digital Programme launched in 2017 to help SMEs embrace digital technology and transform their business process will be expanded. More sectors will get their own Industry Digital Plans (IDP), which will guide the SMEs in the sectors on relevant technologies and skills training programmes. Collectively, these will cover the different needs of 23 sectors, up from the current ten sectors. Some of the new sectors that will benefit are Healthcare, Food Manufacturing, Adult and Early Childhood Education. IDPs are currently available for sectors such as Environmental Services, Retail, Food Services, Wholesale Trade, Logistics, Security and Media sectors. Also, the number and range of pre-approved digital solutions, which the government co-funds up to 70%, will be expanded to drive digitalisation among SMEs.

   A new initiative to enable SMEs to gain access to global markets via B2B and B2C digital channels, known as Grow Digital, has been rolled out. The IMDA and Enterprise Singapore will support SMEs to participate in e-commerce platforms. Eligible SMEs will be co-funded at 70% for Multichannel E-commerce Platform solution packages.

3. Enhancement to Market Readiness Access (MRA)

   A broad-based enterprise grant scheme, MRA provides support to companies to take their first step in expanding overseas. To accelerate the internationalisation efforts of SMEs, MRA will be enhanced to:

   • Expand the scope of supportable activities to include: (a) Free Trade Agreement (FTA) consultancy services to support companies in better leveraging FTAs; and (b) in-market business development;
   • Increase the grant cap from $20,000 per year to $100,000 per new market per company over the enhancement period of FY20-22; and
   • Extend 70% support level for another three years, until 31 March 2023.

4. Other Growth Programmes

   Set up to assist Singapore enterprises looking to internationalise for the first-time, GlobalConnect@ Singapore Business Federation(SBF), will have a team of market advisors to assist SMEs through face-to-face market advisory services. Also, SMEs will benefit from networking opportunities, business matching services, referrals to in-market consultants, partners and government contacts, FTA education and advisory, Market insights, and Belt and Road Initiative business matching.

   There are currently 11 SME centres attached to Trade Associations and Chambers (TAC) offering general business diagnosis and advisory services, capability workshops and group-based upgrading projects. The SME centres over the next two years will identify enterprises demonstrating growth ambition, having a good track record of growth or having a scalable or unique business model. Qualifying enterprises, thus identified will receive enhanced support in the form of one-on-one in-depth business diagnosis, business plan development for digital transformation talent development and internationalisation, business coaching and help in the implementation of growth roadmaps.

   The Productivity Solution Grant (PSG), which provides funding support for the adoption of IT solutions and equipment that are pre-identified by the government, will be enhanced to offer a more comprehensive suite of pre-approved solutions. PSG’s support will be expanded to include consultancy services, starting with job redesign. The number of sector-specific solutions on the PSG will also be increased.

1. Enterprise Leadership for Transformation (ELT)

   The three-year pilot is mostly a training programme for business leaders that is delivered in partnership with Institutes of Higher Learning (IHLs), banks, and experienced industry experts. It aims to help business leaders of promising SMEs in achieving the next bound of growth. It is achieved through programmes such as structured modular training to improve capabilities in solving business problems, coaching by advisors and industry practitioners to develop business growth plan, alumni engagement and networking, to enable peer learning and collaboration as well as support for implementing business growth plans.

2. Expansion of Enterprise Transformation Support

   Under this scheme Enterprise Singapore will scale up its support for enterprise transformation by supporting up to 3,000 enterprises in FY20 in their transformation journey through the Enterprise Development Grant (EDG) and by facilitating close to 100 companies identify their intangible assets and develop strategies to harness them.

3. Open Innovation Platform Sector-Wide Challenges

   The Open Innovation Platform (OIP) is a virtual crowd-sourcing platform which bridges business needs with digital solutions. Enterprises place their business challenges on the platform and are matched to tech firms to develop solutions. IMDA will provide 70% co-funding of prize monies for solutions that bring sector-wide benefits. IMDA will also lower the entry barriers for innovation by supporting prototype development whereby 30% of the prize monies will be paid in the first tranche during the development phase to the shortlisted companies and 70% after prototype delivery.

1. Executive-in-Residence Programme (EIR)

   The two-year pilot programme is to help TACs and enterprises engage the services of experienced professionals with relevant expertise as EIRs, to drive industry and enterprise transformation efforts. Enterprise Singapore will support TACs in identifying, engaging and matching these professionals with interested enterprises besides defraying up to 70% of the costs of engaging EIRs.

2. Heartland Enterprise Upgrading Programme (HEUP)

   Jointly administered by Enterprise Singapore and the Housing and Development Board, with support from Heartland Enterprise Centre Singapore the HEUP aims to create more vibrant commercial precincts in the headland by rejuvenating and transforming the enterprises there. The enterprises will also receive further assistance to improve productivity through business advisory, digitalisation road-mapping, and brand transformation This will be implemented through Merchants’ Associations (MAs), with support from Town Councils, Citizens’ Consultative Committees, grassroots organisations and relevant government agencies.

3. Enhancing Digital Connectivity

   This scheme is to provide businesses and traders with more efficient trade processes and expanded market access by digitalising trade process and improving connectivity with overseas traders. The projects under the scheme are:

   • Nationwide E-invoicing Network that allows suppliers to send e-invoices via this network to the Government;
   • Networked Trade Platform (NTP) that supports international trade data exchange to facilitate trade, risk assessment and enhance supply chain security for which collaborations are ongoing with China, Indonesia and the Netherlands to allow the international exchange of customs declaration data;
   • Digital Economy Agreements (DEAs) provide a government-to-government (G2G) framework to facilitate seamless end-to-end digital trade, digital flows and foster greater international cooperation on emerging digital issues such as Artificial Intelligence.

1. Skillsfuture Credit (SFC)

   Introduced in 2015 to promote lifelong learning among Singaporeans to equip themselves with skills that are relevant for the evolving workplace requirements, the SFC has received a further impetus to drive the transformation of Singapore’s workforce.

2. SkillsFuture Credit (SFC)

   Singaporeans aged 25 years and above (as of 31 December 2020) will receive a one-off top-up of S$500. Eligible individuals can start using the additional $500 SFC from 1 October 2020. While the opening credit of S$500 will continue to have no expiry, unused top-up credit will lapse after 31 December 2025.

3. SkillsFuture Enterprise Credit (SFEC)

   The scheme spurs employers to undertake enterprise and workforce transformation initiatives in tandem. Eligible employers will receive a one-off $10,000 credit to cover up to 90% of out-of-pocket expenses incurred towards enterprise capability development and workforce transformation programmes. However, no more than S$7,000 of the credit can be used on enterprise capability development, but the entire amount can be used for workforce transformation programmes. A list of supportable programmes that are reviewed from time to time is available at Enterprise Singapore website.

4. SkillsFuture Mid-Career Support Package

   This is to facilitate the career transition of Singaporean workers in their 40s to 50s, improve their access to good jobs while making them employable through reskilling. It aims to increase the annual placements to 5,500. On the demand side, it targets employers by encouraging more employers to step up efforts to recruit, re-train, and retain mature workers through Hiring Incentives. Under the Hiring Incentives, employers are given 20% salary support for six months, capped at $6,000 in total when they hire new local workers aged 40 and above through select reskilling programmes such as Professional Conversion Programmes (PCPs), Place-and-Train (PnT) programmes, and career transition programmes by Continuing Education and Training (CET) centres. On the supply side, through the SkillsFuture Credit top-up for the 40s and 50s scheme, individuals who are Singapore Citizens aged 40 to 60 (as at 31 December 2020), are given a one-off top-up of $500. This top-up is in addition to the one-off top-up given those aged 25 year and above. Any unused credit will lapse after 31 December 2025.

Reduction in S Pass sub-Dependency Ratio Ceiling (DRC)

While the duration of schemes intended to enhance the skills and employability of the local workforce are being extended, or its scope being widened, the government is also keen to increase the job opportunities for the skilled Singaporean workforce developed through the targeted skills development programmes. The restructuring is also aimed at reducing the country’s dependence on foreign workers. As announced in Budget 2019, the Dependency Ratio Ceiling (DRC) is reduced for the service sector. Also, the S Pass sub-DRC will be reduced for the Construction, Marine Shipyard and Process sectors. The changes will take effect from 1 January 2021. Notably, when the change is implemented, firms will not be able to renew work passes of foreign workers that have exceeded the revised DRC or sub-DRC can retain them until their work passes expire to avoid disrupting existing operations.