SINGAPORE - To foster the spirit of giving among Singaporeans, the Government is extending a tax deduction scheme for another three years, until December 2021, for those who donate to charities known as Institution of a Public Character (IPC).
For every $1 donated to an IPC, such as the National Kidney Foundation or the Singapore Children's Society, donors get $2.50 deducted off their taxable income. This 250 per cent tax deduction has been in place since 2009.
This is one of the measures to promote volunteerism and philanthropy which were announced by Finance Minister Heng Swee Keat in his Budget speech on Monday (Feb 19).
The Government will match, dollar to dollar, all donations to the new Empowering for Life Fund set up under the President's Challenge 2018. The fund supports programmes to help the most vulnerable Singaporeans upgrade their skills, among other aims.
The Government will also give $3 for every $1 in donation raised by the Community Development Councils (CDC), up to a cap of $40 million a year from the 2018 financial year, which starts in April. The current cap is up to $24 million a year.
With the higher cap, Ms Low Yen Ling, chairman of the Mayors' Committee, said the five CDCs will introduce new initiatives and scale up its programmes to benefit more people.
To boost corporate giving, the Business and IPC Partnership scheme (BIPS), which started in 2016, will also be extended for another three years. Firms get a 250 per cent tax deduction on wages and associated expenses when they send their staff to be seconded at or to volunteer at an IPC, or when they provide services to the charity.
Likewise, another donation scheme, Share As One, will also be extended by three years. Share is the Community Chest's regular donations scheme.
Under the Share As One scheme, the Government will match, dollar for dollar, any "incremental donations" to Share. This means that the sums donated for the year that are above the sum given in the 2015 financial year will be matched dollar for dollar.
The Government has set aside about $190 million a year to support these extensions and enhancements to schemes to promote volunteerism and philanthropy.
These initiatives come as more people volunteer or give to charity, said Mr Heng. According to the latest Commissioner of Charities Annual report 2016, donations have increased from about $2 billion in 2011 to $2.7 billion in 2015.
News of the extension of the 250 per cent tax deduction scheme was welcomed by the heads of charities interviewed by The Straits Times. They said the generous tax deduction is one incentive for some of their donors to give, especially the wealthier ones.
As for the extension of the BIPS scheme, Mr Alfred Tan, chief executive of the Singapore Children's Society, hopes this will spur more firms to send their staff, such as those well versed in innovation and technology, to volunteer at charities.
He said: "The sharing of expertise is very valuable to help charities innovate and progress."
Meanwhile, Mr Heng also said the Government plans to re-design more roles in the social service sector to create more volunteering opportunities. The National Volunteer and Philanthropy Centre's online portal, Giving.sg, will be enhanced to match donors and volunteers with charities more effectively.