Plenty to look out for in Budget

Pioneer package expected to be major component; firms looking for help too

Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam arriving at Parliament House on Feb 17, 2012. -- ST PHOTO: SAMUEL HE
Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam arriving at Parliament House on Feb 17, 2012. -- ST PHOTO: SAMUEL HE

Weeks of speculation over the likely content of this year's Budget will finally be put to rest today.

Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam will deliver the Budget statement in Parliament at 3.30pm.

Both individuals and companies will have plenty to look out for this year, going by pre-Budget hints from the Government and tips from observers.

The Pioneer Generation Package is expected to be a major component of this year's Budget.

Intended to honour the pioneer generation, the package is targeted at Singapore citizens who were 16 years or older in 1965 and who received citizenship by Dec 31, 1986.

It will include health-care subsidies, Medisave top-ups and other benefits.

For their part, companies will be on the lookout for tweaks to existing schemes that aim to help them with their restructuring efforts.

In Budget 2013, the Government unveiled a three-year transition support package to help firms become more efficient and move up the value chain.

Business associations, auditors and firms have called for tweaks to the schemes in this package, to prevent abuses and help companies with long-term transitions.

For instance, some observers expect the Productivity and Innovation Credit - which encourages businesses to invest in technology and automation to enhance their productivity - to be fine-tuned and extended beyond its 2015 expiry date.

Small and medium-sized enterprises have also called for more aid with expanding abroad, and improving their access to finance.

In line with efforts to cultivate a more inclusive society, analysts have suggested that higher taxes on wealth to pay for a likely increase in social spending and to reduce the income gap might be likely.

The wheels of a more progressive system were set in motion last year, with a shift towards taxing assets rather than income.

Higher property taxes on investment and higher-end owner-occupied homes were introduced, while the tax rate for luxury cars was also raised.

Of course, Singaporeans hope for "goodies" every time the Budget rolls around - and sometimes, these hopes are fulfilled.

For instance, the abolition of the radio and TV licence in Budget 2011 came as a pleasant surprise.

In previous Budgets, the Government has handed out income tax rebates and "growth dividends", in a bid to share the fruits of economic growth with Singaporeans, and help households with costs.

For more news and analysis on Singapore Budget 2014, click here for ST's Big Story coverage.

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