The National Solidarity Party (NSP) released its budget paper on Wednesday, which calls on the Government to give businesses more time to adjust to economic restructuring, and to put in place an even more progressive tax system.
Local small and medium enterprises (SMEs) are still struggling to cope with increasing foreign worker levies, the tightening of the inflow of foreign workers and high rents, the NSP said.
The Government's Budget measures such as a corporate tax rebate and the Wage Credit Scheme, which subsidises salary increases for Singaporeans, tend to benefit companies that are profitable or doing well, it added.
"With the writing so clearly on the wall, that the days of abundant cheap foreign labour are over, these businesses should be given a bit more time to reinvent themselves," said the party.
It wants the Government to halve foreign worker levies for local SMEs for one year only, and increase the SME Cash Grant cap to $10,000. It also called for more government-owned office and shop space to meet the high demand for commercial space.
The NSP also noted that while the Government has introduced higher wealth taxes in this year's budget, it still retains the goods and services tax which the opposition party called "regressive".
The NSP suggested a cut in GST from 7 per cent to 5.5 per cent, an increase in the tax rate for those in the top income bracket from 20 per cent to 22 per cent, reinstating estate duty and raising casino tax rates.
The party also said the Government should increase the percentage of its expenditure allocated for development, given the number of infrastructural upgrades in the pipeline.