Budget 2023: Helping Singaporeans to weather global uncertainty
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Measures will be taken to help Singaporeans tide over immediate cost-of-living pressures, said DPM Lawrence Wong.
ST PHOTO: KELVIN CHNG
SINGAPORE - This year’s Budget is about equipping Singaporeans to weather the “formidable challenges” expected as a result of heightened global uncertainty, Deputy Prime Minister Lawrence Wong said in his Budget speech in Parliament on Tuesday.
DPM Wong, who is also Finance Minister, said the Government expects total expenditure for fiscal year 2023 to hit $104.1 billion, a drop of 2.6 per cent from FY2022 as measures to manage Covid-19 are scaled back.
Expenditure by the Manpower Ministry is also expected to decrease by $2.3 billion, or 37.6 per cent, year over year, mainly due to the Jobs Growth Incentive scheme ending in March.
Culture, Community and Youth Ministry expenditure will fall by $1.6 billion, or 40.5 per cent, year over year due to the one-off nature of a termination sum payable for the Government taking over the Sports Hub in FY2022.
Still, the total expenditure estimated for FY2023 is higher than for FY2021 and the years before, as measures will be taken to help tide Singaporeans over immediate cost-of-living pressures, among other things.
Moves to secure better prospects for the economy by encouraging investments and upskilling workers are also on the cards. These include topping up the National Productivity Fund with $4 billion to redouble efforts to attract high-quality investments from multinational enterprises (MNEs).
To fund these measures, the Government is expecting operating revenue of $96.7 billion in FY2023, which is up by 7.1 per cent over revised FY2022 estimates.
Revenue will be driven by higher goods and services tax collections, which are expected to hit $17.4 billion, representing a 20.2 per cent rise year over year.
Meanwhile, assets taxes are estimated to increase by 9.6 per cent to $5.6 billion due to a hike in property tax rates and expected higher property annual values in 2023 as rentals rise.
Corporate and personal income tax collections are also expected to swell.
A global minimum effective tax rate of 15 per cent will be introduced for large Singapore MNEs, while a domestic top-up tax that will raise large MNE groups’ effective tax rate here to 15 per cent will also be implemented from 2025.
As a whole, DPM Wong is expecting a Budget deficit of $400 million, or 0.1 per cent of gross domestic product.
“This is appropriate for the projected economic conditions this year,” he said. “For the last three financial years, we have had to draw on past reserves to cope with the unexpected shocks and disruptions of the pandemic. As things return to normal, we will not need to make any draw on the past reserves in this year’s Budget.”
