A Budget to fortify economy and society

Budget 2024, which was announced by Deputy Prime Minister and Finance Minister Lawrence Wong on Feb 16, was

a judicious blend of measures

to strengthen the foundations of the economy and advance the progressive social agenda set out in the fourth-generation (4G) leadership’s Forward Singapore initiative. Comprehensive in its coverage, the $131.4 billion Budget provides relief from cost pressures for individuals, families and businesses as well as targeted support for various groups, including mid-career and low-income workers, seniors, Institute of Technical Education graduates and people with disabilities. Given that inflation is on a falling trajectory, albeit at higher than historical levels, the cost offsets are appropriately time-bound and dollar-capped.

Companies, especially small and medium-sized enterprises (SMEs), stand to benefit from a $1.3 billion Enterprise Support Package, including a 50 per cent corporate income tax rebate capped at a high level of $40,000 in the 2024 year of assessment; there is also an enhanced Enterprise Financing Scheme which helps companies secure financing and an extension of the SkillsFuture Enterprise Credit, which subsidises their retraining costs. All companies will benefit from Budget 2024’s substantial top-ups to government funds to boost research and development, productivity, financial sector development, green initiatives, the artificial intelligence ecosystem and the broadband infrastructure. Large multinational enterprises, which will be subject to a global minimum effective tax of 15 per cent from 2025 get some clarity on their tax obligations. Those that enjoy tax subsidies will have their effective tax rates topped up to 15 per cent. But they stand to benefit from refundable investment credits, which will be awarded for significant qualified investments and can be offset against corporate tax or taken in cash.