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Welcome to Our Singapore Budget 2019 Summary
The following is the Budget 2019 Summary announced by Minister for Finance, Mr. Heng Swee Keat in his Budget Statement for the Financial Year 2019 which was delivered in Parliament on Monday, 18 February 2019.
Personal Income Tax Rebate for resident individual taxpayers for Year of Assessment (“YA”) 2019
As part of the Bicentennial Bonus, a Personal Income Tax Rebate of 50% of tax payable will be granted to all tax resident individuals for YA 2019 (i.e. for income earned in 2018). The rebate will be capped at $200 per taxpayer.
Allow resident individual taxpayers to claim Grandparent Caregiver Relief in respect of a handicapped and unmarried dependent child, regardless of the child’s age
To provide greater support and recognition to working mothers with handicapped and unmarried dependent children, taxpayers will be allowed to claim Grandparent Caregiver Relief in respect of a handicapped and unmarried dependent child, regardless of the child’s age, if they have met all other conditions. This will take effect from YA 2020 (i.e. for income earned in 2019).
Lapsing of the Not Ordinarily Resident (“NOR”) scheme
The NOR scheme will lapse after YA 2020. The last such NOR status will be granted for YA 2020 and expire in YA 2024. Individuals who have been accorded the NOR status will continue to be granted NOR tax concessions until their NOR status expires, if they continue to meet the conditions of the concessions.
Extend the Writing Down Allowance (“WDA”) for acquisition of qualifying Intellectual Property Rights (“IPRs”) under section 19B of the Income Tax Act (“ITA”)
In recognition that IPRs are important creators of value in a knowledge-based economy, the WDA under section 19B will be extended to cover capital expenditure incurred in respect of qualifying IPRs acquired on or before the last day of the basis period for YA 2025.
Extend the income tax concessions for Singapore-listed Real Estate Investment Trusts (“S-REITs”)
To continue to promote the listing of REITs in Singapore and to strengthen Singapore’s position as a REITs hub in Asia, the existing tax concessions for S-REITs will be extended till 31 December 2025. The sunset clause for the tax exemption on S-REITs distributions received by individuals will be removed. All other conditions for the income tax concessions remain the same. MAS will provide further details of the change by May 2019.
Extend the income tax concessions for Singapore-listed Real Estate Investment Trusts Exchange-Traded Funds (“REITs ETFs”)
The existing tax treatment accorded to REITs ETFs will be extended till 31 December 2025. The sunset clause will be removed for the tax exemption on REITs ETFs distributions received by individuals. All other conditions for the income tax concessions remain the same. MAS will provide further details of the change by May 2019.
Lapsing of Designated Unit Trust (“DUT”) scheme after 31 March 2019
Existing DUTs will continue to receive the tax deferral benefits under the DUT scheme, on and after 1 April 2019, if they continue to meet all the conditions.
Lapsing of Approved Unit Trust (“AUT”) scheme after 18 February 2019
Existing AUTs will continue to receive the tax concession under the AUT scheme for a period of five years from YA 2020 to YA 2024. This will allow existing AUTs sufficient time to transit to alternative tax incentive schemes, where relevant.
Goods and Services Tax
Tighten the GST Import Relief for Travellers
Travellers who spend less than 48 hours outside Singapore will get GST import relief for the first $100 (instead of $150 currently) of the value of goods bought overseas. Travellers who spend at least 48 hours outside Singapore will get GST import relief for the first $500 (instead of $600 currently) of the value of goods bought overseas.
This will take effect for travellers arriving in Singapore from 12.00am, 19 February 2019.
Extend the GST remission for S-REITs and Singapore-listed Registered Business Trusts (“RBTs”) in the infrastructure business, ship leasing and aircraft leasing sectors
To continue facilitating the listing of S-REITs and RBTs in the infrastructure business, ship leasing and aircraft leasing sectors, the existing GST Singapore remission will be extended till 31 December 2025. All conditions for the GST remission remain the same. MAS will provide further details of the change by May 2019.
Lapse the Property Tax (Tourist Projects) Order
The Property Tax (Tourist Projects) Order will lapse after 18 February 2019.
OTHER TAX MEASURES
Restructuring Diesel Taxes
- Reduce Special Tax for diesel vehicles – $100 lower for diesel cars, $850 lower for diesel taxis
- Increase diesel excise duty by $0.10 per litre, to $0.20 per litre
- Commercial Diesel Vehicles – Road tax rebates of 100%, 75%, and 50% until 2021
- Diesel Buses Ferrying Students – Additional cash rebates of $1,800, $900, and $500 until 2021
Scale-up SG Programme
New programme to help high-growth local firms innovate, grow, and internationalise
Innovation Agents Programme
Pilot for enterprises to tap on experienced industry experts for advice on innovation and commercialisation opportunities
SME Co-investment Fund III
$100 million investment by Government to catalyse private sector funding in SMEs that are ready to scale up Open Innovation Platform
Enterprise Financing Scheme
- Streamlining of existing financing schemes to better support SMEs to access bank financing
- Enhanced support for companies incorporated for less than five years
- Extension of enhanced support for working capital to support SMEs, until 31 March 2021
SMEs Go Digital Programme
Expansion of Industry Digital Plans to more sectors, and more choices of preapproved digital solutions
Digital Services Lab
Pilot programme to address digitalisation challenges in services sectors, through collaboration with industry and research partners
Automation Support Package
Two-year extension to support businesses in deploying impactful and largescale automation technologies (until 31 March 2021)
One-stop Portal for Firms to transact with Government
Launch of pilot portal for the food services sector, to streamline regulatory touch-points with government, from up to 14 to 1
New Professional Conversion Programmes
Support for mid-career professionals to enter new growth areas, e.g. blockchain, embedded software development, and prefabrication
Career Support Programme
Two-year extension to provide wage support for companies that hire Singaporeans who are mature and retrenched, or in long-term unemployment (until 31 March 2021)
Enterprise Development Grant (EDG)
- Include positive outcomes for workers, e.g. wage increases, for all EDG supported efforts starting from 1 April 2020
- Three-year extension (until 31 March 2023) of enhanced support level of up to 70%, in view of foreign workforce policy changes
Productivity Solutions Grant
Three-year extension (until 31 March 2023) of enhanced support level of up to 70%, in view of foreign workforce policy changes
Career Support Programme
- Two-year extension to provide wage support for companies that hire Singaporeans who are mature and retrenched, or in long-term unemployment (until 31 March 2021)
- Ensuring that our firms and workers remain competitive and relevant
- Expand scope to also support out-of-pocket cost for training, capped at $10,000
Two-step reduction of Services Sector Dependency Ratio Ceilings (DRCs):
38% from 1 Jan 2020
35% from 1 Jan 2021
|S Pass Sub-DRC||15%|
13% from 1 Jan 2020
10% from 1 Jan 2021
Deferment of Foreign Worker Levy Hikes
Defer earlier announced increase in levy rates for Marine Shipyard and Process sectors for another year
BICENTENNIAL COMMUNITY FUND
$200 million fund to provide dollar-for-dollar matching for donations made to Institutions of a Public Character (IPCs) from 1 April 2019 until 31 March 2020, with a cap
- A Bicentennial GST voucher payment of S$150 to S$300, for people aged 21 and above, depending on the annual value of your home.
- Those with a value of up to $13,000 will receive S$300, while those between S$13,000 to S$21,000 will receive $150.
- This is on topof the regular GST Voucher payment given out annually.
- An additional 10 per cent added to payments made under the Workfare Income Supplement (WIS) scheme, for work done in 2018. This payment will range from a minimum of S$100 to a maximum of S$360, in cash, depending on your age starting from 35, and whether you are an employee or self-employed.
- A S$150 top-up in the Edusave accounts of Primary and Secondary school students.
- A top-up of either S$250 or S$500 for students aged 17-20 in their Post-Secondary Education Accounts (PSEA), depending on whether their annual home value for 2018 exceeded S$13,000.
- Between S$300 to S$1,000 in CPF top-ups for those with lower CPF balances, aged 50 to 64. This range depends on the age of those eligible, and whether they have below S$30,000 or between $30,000 to S$60,000 in their CPF balances.
Merdeka Generation Package
Eligible for those born between 1950 and 1959 and became a Singaporean citizen before 1997, or
born in or before 1949, became a Singaporean citizen before 1997, but did not receive the Pioneer Generation Package.
Many of the benefits under this package are healthcare-related:
- A one-off S$100 top-up to your PAssion Silver card which can be used for, among other things, Community Club activities, entry to public swimming pools, and public transport.
- An annual MediSave top-up of S$200 per year, starting from this year to 2023.
- Additional subsidies for outpatient care, such as special subsidies at clinics and dentists under the Community Health Assistant Scheme (CHAS), and an additional 25 per cent off subsidised bills at polyclinics and public Specialist Outpatient Clinics (SOCs)
- Additional MediShield Life premium subsidies, where there will be an additional 5 per cent subsidy for annual premiums, that will then increase to 10 per cent after the age of 75.
- Additional participation incentive of S$1,500 for joining CareShield Life, once it is available from 2021 onwards.
Five-Year MediSave Top-up
The Government will provide a MediSave top-up of $100 a year from 2019 to 2023 Singaporeans who meet all of the following criteria:
- Singapore Citizen as at 31 December of the year preceding the top-up;
- Born in or before 1969; and
- Do not receive benefits from the Merdeka Generation Package or Pioneer Generation Package.
Service and Conservancy Charges (S&CC) Rebates
Eligible Singaporean households living in HDB flats will receive rebates to offset between 1.5 and 3.5 months of S&CC charges.
Foreign Domestic Worker (FDW) Levy
Levies will be increased for foreign domestic workers that are employed without levy concession from 1 April 2019. Concessionary FDW Levy of $60 remains.
- Current 230km of MRT lines will rise to about 360km in the 2030s when major MRT projects such as the Cross Island Line are completed.
- Increasing the capacities of our airport and sea port to enhance our global connectivity