SINGAPORE - The Government may need to keep pumping cash into the economy for at least a few more months to help sustain businesses and jobs vulnerable to the Covid-19 pandemic, the Singapore Indian Chamber of Commerce and Industry (SICCI) said.
"Despite efforts in Singapore to cope with the virus in an endemic situation, SICCI is of the opinion that the end of the tunnel is still some way off," the chamber said in its Budget 2022 submission to the Ministry of Finance on Thursday (Feb 3).
SICCI added that most businesses have had a challenging time since March 2020 - particularly those in the retail and food and beverage (F&B) industries that have been hit hard given their dependence on travel and tourism.
"Hence, we would like to urge the Ministry not to be too hasty in discontinuing many of the help schemes which have been introduced for both individuals and companies through the various Resilience Budget packages and supplementary budgets announced in the past two years.
"Much of these schemes, such as the Jobs Support Scheme and waivers to rentals for businesses, may be needed at least for another nine months in the next financial year 2022-2023, and can be progressively lifted," it said.
The chamber submitted its suggestions and proposals for the Budget due Feb 18 under five broad categories: tax matters and addressing inequality; climate change and greening; ageing and mental health; foreign workers; and associated flexible employment schemes.
On tax issues, SICCI said the much anticipated hike in goods and services tax (GST) might dampen consumer spending in the critical retail and F&B sectors and consequently affect many small and medium-sized enterprises (SMEs).
"The SICCI urges the Ministry to selectively apply the GST scheme so that businesses do not face a sudden increase in expenses once the GST scheme is introduced," said the chamber.
If GST rates are raised, the SICCI expects the Budget to accompany mitigating measures for SMEs.
Separately, the Chamber proposed a property gains tax of at least 20 per cent if a property is sold within five years, and 10 per cent after that, as well as a surcharge on income taxes on taxable incomes exceeding $1 million a year and tax holidays for companies building eldercare facilities - both locally and near Singapore, such as inJohor and Batam.
The SICCI also recommended that the Government make it mandatory for companies to pay a proportion of their employees' utility bills when they are working from home.
"Since working from home continues to be the default, this move will encourage more workers who can work from home and help reduce transmissions in the community," it said.
To help achieve Singapore Green Plan 2030 objectives, the SICCI proposed a tax rebate for two to three years to write off the cost of leasing an electric car.
It also asked the Singapore authorities to work closely with their Malaysian counterparts to ensure that electrical cars driven up to Malaysia have facilities to charge during the road journey.
SICCI called on the Government to make greater strides in attracting the silver generation back into the economy, and urged for more job incentives to attract them back into the workforce.
The chamber believes that more healthcare spending will be needed to address mental health problems, especially in the younger generation, who are facing the ups and downs of the current economic situation.
Migrant workers in the dormitories will also require a decentralised or mobile healthcare support system as they continue to face movements restrictions on their off days, it said.
With life and work balance lines blurred, trade associations and chambers should be incentivised to work closely with mental health institutions to conduct refresher programmes for their employees on mental wellness, said the chamber.
The SICCI urged the Government to expedite the entry of foreign workers from more countries, especially those from South Asia, as they have been a traditional source of manpower for the construction, marine, and F&B sectors.
To disincentivise companies from shifting their operations overseas or using cheaper and better skilled labour abroad, SICCI asked the Government to develop mobile, flexible employment schemes through outsourcing companies focused on Singaporean workers.
"Using this method, a greater percentage of the population can be deployed effectively and companies can add a 'plug-and-play' workforce to complement their core staff."