Singapore Budget 2018: Organisations and businesses react to the Budget speech

Finance Minister Heng Swee Keat delivering his Budget 2018 speech in Parliament on Feb 19, 2018.
Finance Minister Heng Swee Keat delivering his Budget 2018 speech in Parliament on Feb 19, 2018.PHOTO: SCREENGRAB FROM YOUTUBE/MOFSPORE

SINGAPORE - Finance Minister Heng Swee Keat presented this year's Budget in Parliament on Monday (Feb 19), where he unveiled Singapore's plans in the face of three major shifts in the coming decade.

These include a greater shift in global economic weight towards Asia, the emergence of new technologies, and ageing.

Here is a look at how organisations and businesses have reacted to the Budget speech:

Singapore Manufacturing Federation (SMF)

SMF president Douglas Foo said the Productivity Solutions Grant and tax deduction for intellectual property registration fee will boost innovation here.

And the Pact, or Partnerships for Capability Transformation scheme, which provides companies with up to 70 per cent co-funding in partnership projects, will help smaller manufacturers to scale up by encouraging them to work together.

Extending the Tech Skills Accelerator (TeSA) to manufacturing, the Wage Credit Scheme and the enhanced corporate tax rebate will also be beneficial for the industry, he noted.

Association of Women for Action and Research (Aware)


AWARE said the measures in this year's Budget targeted at the elderly and their caregivers appear "relatively piecemeal". PHOTO: AFP

Aware said it was "painfully disappointing" that the Budget speech did not provide a comprehensive vision to ensure adequate care for families and older persons.

"Previous Budgets have announced bold moves to support Singapore's ageing population - such as the Pioneer Generation Package, which Aware has recently recommended should be extended to all cohorts of older persons," it said.

In contrast, the measures in this year's Budget targeted at the elderly and their caregivers appear "relatively piecemeal", it added.

Singapore Chinese Chamber of Commerce & Industry (SCCCI)


Businesses affected by the carbon tax immediately from 2019 will need the Government's grant support to improve their energy efficiency to help mitigate the impact. PHOTO: ST FILE

SCCCI president Roland Ng said he is heartened to see measures to help businesses transform and upgrade through productivity improvement and innovation in this year's Budget.

However, he noted that "businesses, especially our SMEs, affected by the carbon tax immediately from 2019 will need the Government's grant support to improve their energy efficiency to help mitigate the impact".

Singapore Institute of Accredited Tax Professionals


A tax-free sign at a shop in ION Orchard on Feb 17, 2018. ST PHOTO: LIN ZHAOWEI

Amid rising business costs, the enhancement and extension to the corporate tax rebate is a welcome relief, said chairman Gerard Ee.

He said this sentiment is shared among all tax-paying companies, especially the smaller ones.

He also lauded the move to raise the cap for double tax deduction without prior approval from 2019.

"This will no doubt aid businesses in being even more nimble as they tread new waters and internationalise," he said.

UOB


UOB economist Francis Tan said the Ministry of Finance continued to keep its focus on long-term economic restructuring over short-term relief measures. PHOTO: REUTERS

UOB economist Francis Tan said there was less mention and emphasis on shorter term budget measures to help businesses on the back of the stronger economic growth last year.

"Budget 2018 comes as the economy is doing better," he said, comparing it with the first two Budgets in the term of government.

The bank estimated that the focus on shorter term measures fell to 13 per cent of total economic measures, from 25 per cent in Budget 2017.

"The Government pressed on with its multi-year efforts on longer term economic restructuring as it pushed out the four key pillars of: capturing future opportunities; fostering pervasive innovation; building deep capabilities; and forging strong partnerships," said Mr Tan.

However, he noted that "the Ministry of Finance continued to focus on allocating a larger part of its resources towards longer term economic restructuring, compared to those for short term relief measures".

Singapore Environment Council


Pricing carbon is the most efficient, fair and cost-effective way to help Singapore reach its carbon reduction target of 36 per cent. PHOTO: AFP

Council chairman Isabella Loh described the new carbon tax as beneficial for the environment, consumers and the economy.

"It will be instrumental in helping Singapore reach its carbon reduction target of 36 per cent. Pricing carbon is the most efficient, fair and cost-effective way to meet this commitment," she said.

Executive director Jen Teo said climate change is "arguably the most important issue facing Singapore". She added that consumers should play a role in reducing their carbon footprint.

Grab


A Grab taxi leaves the office in Jalan Pemimpin on Dec 29, 2017. ST PHOTO: KUA CHEE SIONG

Local ride-hailing firm Grab noted that the Government is providing more support to encourage innovation here. It said companies should actively grow their tech ecosystems to enable Singaporeans to benefit from the digital economy.

Few people in Singapore are experts in new technologies, such as data science, machine learning and artificial intelligence, and the priority should be to arm local young talent with these skills that are highly sought after.

Describing South-east Asia as a region "on the cusp of a digital transformation", Grab said the Republic can compete with global firms by investing in capability development as well as creating digital innovations tailored to the region.

Ernst & Young Solutions


The SG Bonus would be well received by lower income families regardless of their tax paying circumstances. ST PHOTO: LIN ZHAOWEI

Mr Panneer Selvam, partner with the people advisory services, described the SG bonus as a pleasant surprise.

He noted that in last year's Budget, a personal income tax rebate of 20 per cent of tax payable, capped at $500, was accorded to both resident local and foreign taxpayers.

The tax rebate - a direct offset against a taxpayer's tax payable - had largely benefited those with above-average incomes.

He said some people may be disappointed that no rebates were announced this year.

But he added that the SG Bonus would be well received by lower income families regardless of their tax paying circumstances.

DBS Bank


The increase in stamp duty for property purchases revealed the Government's prudent approach towards managing prevailing macroeconomic dynamics. ST PHOTO: LIM YAOHUI

DBS senior economist Irvin Seah said the Budget focused on long-term issues, such as economic transformation, innovation incentives, the social safety net, and fiscal sustainability.

But the short-term measures have revealed the Government's prudent approach towards managing prevailing macroeconomic dynamics, he noted.

Such measures include the increase in stamp duty for property purchases and the enhancement of corporate income tax rebates.

On the budgeted deficit of $600 million expected for the 2018 financial year, he said that "we believe the outcome would surprise on the upside, given the sanguine economic climate".

Milestone Systems


A passenger uses the dual facial and thumbprint biometric recognition system at Changi Airport’s new Terminal 4. PHOTO: ST FILE

Mr Benjamin Low, Asia-Pacific vice-president of video management system provider Milestone Systems, said security challenges have evolved rapidly over the years, increasing the demand for such services and driving the development of new technologies.

"Advanced technology such as facial recognition, artificial intelligence (AI) and machine learning, is increasingly embedded in the systems which keep us safe," he said.

He noted that there is a growing need for people with skills to run such technology, and lauded the Government's investment in initiatives such as TeSA.

Baker Tilly TFW


Tax partner Boey Yoke Ping expects the implementation of the 9 per cent GST will be stepped by one percentage point at each stage. ST PHOTO: YEN MENG JIIN

Tax partner Boey Yoke Ping said the GST increase to 9 per cent was expected, though she said it is good news that it will not be immediate.

"Although likely to be implemented sooner rather than later between 2021 and 2025, we expect that the implementation will be stepped by one percentage point at each stage," she said.

Deloitte Singapore


There are welcome boosts for the environment, healthcare, infrastructure, charities and social services. ST PHOTO: LIN ZHAOWEI

Regional managing partner for tax Low Hwee Chua said that beyond the headline tax changes, there are welcome boosts for the environment, healthcare, infrastructure, charities and social services.

"It's another steady Budget from a Government that prides itself on providing financial and fiscal stability to attract investors and this approach will help position Singapore for the challenges of the new decade," he said.

Tableau Software


Wholemeal noodles being weighed at Leong Guan Food Manufacturer’s factory which has begun research and development to increase the wholegrain content of their wholegrain noodles. ST PHOTO: TIMOTHY DAVID

Data visualisation company Tableau Software senior vice-president of Asia-Pacific JY Pook called the new measures to up-skill Singapore's workforce encouraging.

This will bridge the gap between the demand and supply for talent with digital skills, as new and emerging technology is increasingly changing the way people work, he said.

Though businesses have started to harness insights from data in their work, he said their decisions need to be quick to keep up with the change of pace today.

PSB Academy


A class in session at PSB Academy. PHOTO: PSB ACADEMY

Chief executive officer Derrick Chang said the continued investment in innovation and new technologies is reassuring, and the move is an indication of the country's unwavering drive towards nurturing a future-ready core.

He stressed the need for a collaborative effort between the public and private sectors for innovation to grow.

Singapore's appointment as Asean chair for 2018 also charts a path for the exchange of cross-border knowledge and ideas, he said.

He added that the country stands to benefit from a network of talented international alumni around the world, as more students here are studying in universities overseas, including at PSB Academy's satellite campuses across Asia.