Forum: Give SMEs more help in this tough climate

A view of the Singapore skyline on Jan 3, 2020. ST PHOTO: LIM YAOHUI

I refer to the Singapore Tourism Board's (STB) initiative (Task force to tackle expected 30% fall in tourists, Feb 12).

The STB's initiative to bring together both the private and public sectors to "lay out strategies for recovery and future growth" is indeed a timely and forward-looking initiative to address the potential impact on Singapore's economy and consequently the livelihood of ordinary workers.

The STB's initiative is just one piece of the jigsaw to ensure that Singapore's economic well-being and growth remain positive.

A collective and comprehensive strategy by all government bodies is needed.

It was reported that UOB, among the banks, telcos and asset managers that have stepped forward to help businesses, allocated $3 billion for its affected clients to manage their cash flow (UOB, other private firms offer help to SMEs hit by coronavirus outbreak, Feb 12).

Cash flow is critical for businesses, especially small and medium-sized enterprises (SMEs), and it is one of many hurdles they have to overcome.

GST-registered businesses are required to pay upfront to suppliers. Exporters who do not collect goods and services tax (GST) from their overseas customers can subsequently claim a refund from the Inland Revenue Authority of Singapore (Iras).

Since reports of an alleged conspiracy by firms to make fraudulent GST claims surfaced in 2016, businesses, specifically mobile phone exporters, have had their refunds "frozen".

I know three SME owners who have refunds of several million dollars coming to them. It has been three years. Surely by now, the Iras auditors should be able to determine whether the refund claims are genuine.

Under the current uncertain business environment, Iras should expedite these refunds where there is no evidence of fraud.

In addition, in the interest of transparency, Iras should release data of the total number of businesses currently under audit, the total refunds withheld and the period that these refunds have been withheld. This data is important for economists to gauge the impact on businesses and the consequent impact on Singapore's economic growth, especially under the current business environment.

As part of giving the economic environment a boost, the Land Transport Authority should consider reducing the electronic road pricing (ERP) charges to help cut business costs. Every little bit will help.

The HDB should also look into giving tenants temporary rental rebates.

Finally, an inter-government task force coordinating with private sector associations would be more effective in addressing the current economic challenges.

Manmohan Singh

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A version of this article appeared in the print edition of The Straits Times on February 15, 2020, with the headline Forum: Give SMEs more help in this tough climate. Subscribe