SINGAPORE - The Singapore Government will keep its 2019 Budget aimed at helping the economy navigate global uncertainties through innovation, internationalisation and capability building for workers, said Minister in the Prime Minister's Office and Second Minister for Finance and Education Indranee Rajah on Friday morning (Feb 1).
In an interview on business and personal finance radio station Money FM 89.3, she noted trade tensions, the slowdown in China's recent economic figures, the International Monetary Fund and World Bank's warnings of "darker skies ahead" and the disruptive potential of technology.
"Budget 2019 is a continuation of our strategy to chart a steady course through this kind of economic uncertainty," she said.
Asked about help for small and medium-sized enterprises (SMEs) in particular, she replied: "The best assistance is really to help SMEs to be productive, to help them to see how to best scale up, how to partner with bigger entities to access opportunities."
She added that this year's Budget will focus "quite a bit" on these areas, as well as moves to further encourage SMEs to band together - although such organisation is most naturally carried out by trade associations and chambers.
As for dealing with the disruption caused by technological change, "the key is helping people to be able to come to grips with it", she said. Citing the existing SkillsFuture scheme, she added: "That will continue but we'll look at ways in which you can help people further."
Economic issues aside, this year's Budget will have a social focus on education and healthcare in particular, as Finance Minister Heng Swee Keat earlier mentioned, as well as measures to encourage volunteering. Ms Indranee added that there will be a "special focus on the underprivileged".
On the perennial question of how to fund spending, she noted that Singapore "cannot over-rely" on the net investments return contribution, which comes from investment returns on the reserves, because the investment climate does vary.
The upcoming hike in goods and services tax from 7 per cent to 9 per cent, due between 2021 and 2025, comes within this context and in view of the long-term needs of healthcare and an ageing population. The exact timing of the hike, however, will depend on the economic situation and circumstances in the next term of government, she added.
As for the e-commerce tax due in 2020, Ms Indranee said the Government is "still working on it", and would not be drawn into revealing more. "Watch this space, but nothing to add on that particular topic for now."