SINGAPORE - About 1.4 million Singaporeans stand to benefit from a one-off Goods and Services Tax (GST) voucher, as the Government unlocks its purse strings to help Singaporeans with the cost of living amid a slowdown in economic growth.
This one-off GST voucher, termed a "cash special payment", is a sum of up to $200, Finance Minister Heng Swee Keat said in the Budget address on Thursday (March 24).
The recipients of this voucher are those who already qualify for the regular GST cash voucher of up to $300, which will be paid out in August.
"If our recipients spend some of these in our neighbourhood shops, it will support our local businesses as well!" Mr Heng quipped.
The additional "cash special payment" is expected to cost the Government an additional $280 million this year, and will be paid out in November.
Eligible recipients are Singaporeans aged 21 and above, who earned $26,000 or less in assessable income in 2015.
They will get a total of $500 if the annual value of their home as at Dec 31 last year (2015) was up to $13,000, and $250 if the annual value of their home as at the same date was between $13,001 and $21,000.
Meanwhile, older Singaporeans and Singaporean households will continue to receive their GST Medisave voucher, and GST Utilities-Save voucher this year.
The enhanced GST voucher is one of a series of measures rolled out in this year's Budget that will give households more support.
The Government is also increasing the basic monthly cash allowance under the Public Assistance, or ComCare Long-Term Assistance, for those who are permanently unable to work and have little or no means of income and family support.
More details will be made known next month, during the Committee of Supply parliamentary sitting for the Ministry of Social and Family Development.
And to help pensioners who draw lower pensions, the Government will also increase the Singapore Allowance and monthly pension ceiling by $20 per month to $300 and $1,230 respectively. This will benefit about 10,000 pensioners.
Meanwhile, the Government will also provide service and conservancy charges (S&CC) rebates of one to three months.
One- and two-room HDB households will get a total of three months of rebates for this year, while three- and four-room households will get two months of rebates.
Households in five-room HDB flats will get rebates of 1½ months, while those in executive flats will get a rebate of one month.
This is set to cost the Government $86 million, and benefit about 840,000 HDB households.
But the Government is also due to make a tax change from the 2018 Year of Assessment.
Mr Heng said this was such that the current 15 personal income tax reliefs - which have been enhanced over the years - will not "unduly reduce total taxable incomes for a small proportion of individuals".
So, the Government is set to introduce a cap on the total amount of personal income tax relief that each individual can claim.
This will be set at $80,000 per Year of Assessment - which Mr Heng said will not affect 99 per cent of tax-resident individuals.
This move is expected to raise $100 million more each year.
"This cap will make our personal income tax system more progressive," he said. "Nevertheless, our personal income tax burden remains low. Our personal income tax structure must allow us to continue to stay competitive."