SINGAPORE - More than half of companies across all major industries want tax relief in the Singapore Budget due to be announced next month as they prepare for a tough year ahead, an industry survey found.
About 55 per cent of both large companies and small and medium-sized enterprises (SMEs) rank corporate/income tax rate reduction and rebates to help upskill staff as the top two priorities for Budget 2020, according to the Singapore Business Federation's (SBF) annual National Business Survey, released on Tuesday (Jan 14).
Nearly half of the survey respondents also seek support in other areas, such as easier access to information and resources from government agencies (49 per cent), incentives for industry-related training (47 per cent) and corporate venturing (47 per cent).
The annual survey, which was carried out from Aug 26 to Oct 25, drew responses from more than 1,000 companies, SBF said in a press release.
Companies are seeking relief after a year wrought by economic uncertainties, partly because of the US-China trade dispute.
Over half of all respondents (51 per cent) felt the Singapore's business climate had worsened over the last 12 months. They were also less satisfied with the regional and global business environment compared to 2018.
For the year ahead, 44 per cent expect similar conditions in Singapore, while 49 per cent anticipate the business climate here will get more challenging. Worries over the global economic climate have also increased.
Other key concerns for 2020 include rising business costs such as for rental and raw materials, rising wages, the uncertainties created by the US-China trade tensions and China's economic slowdown.
The three top challenges for local businesses for this year were identified as manpower costs (67 per cent), business competition (62 per cent) and finding new or better ways to grow revenue (56 per cent).
SBF noted that manpower issues continue to frustrate local companies. The survey showed that while many businesses struggle with rising labour costs, the dynamics arising from tighter government policies on hiring foreigners, and the competition to secure the best local talent are putting real pressure on many companies. Four in 10 businesses also said they face challenges in attracting or retaining younger workers.
Despite the uncertainties, Singapore businesses continue to venture out and expand overseas.
The survey showed that eight in 10 businesses now have an overseas presence. Internationalization has picked up pace, particularly among SMEs (78 per cent versus 68 per cent in 2018). In comparison, 93 per cent of large companies said they have expanded overseas.
SBF chairman Teo Siong Seng said it is critical for Singapore companies to expand overseas to access new markets, diversify their supply chains and to support sustainable growth, given the limitations of Singapore's small domestic market.
"It is encouraging that our SMEs are extending their global footprints more aggressively despite the economic uncertainty that shrouded 2019," he said.
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