Singapore Budget 2020: Summary of Government Initiatives

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Singapore's Central Business District (CBD) pictured in 2020. Photo from The Straits Times.

The Singapore Budget for 2020 was delivered by Mr Heng Swee Keat on 18 February 2020 at 3 pm.[1] Mr Heng is the Deputy Prime Minister and Minister of Finance as of February 2020.[2] This budget covers the financial year of April 2020 to March 2021.[3] The government has set aside a S$106 billion budget to (i) Grow the Singapore economy (ii) Care for Singaporeans (iii) Sustain Singapore’s success (iv) Build Singapore as a community.[4][5][6]

General background[edit | edit source]

Heng Swee Keat delivering the Budget 2020 speech on 18 February 2020. Photo from Channel News Asia.

Weak economic growth[edit | edit source]

In 2019, Singapore’s economy grew by a modest 0.7%. This is the weakest growth since the 2008 Financial Crisis.[7] Two days before the release of the Budget, Singapore’s Ministry of Trade and Industry downgraded Singapore’s growth forecast from between 0.5 - 2.5% to between -0.5 - 1.5%.[8] This indicates a possible recession for Singapore.

COVID-19[edit | edit source]

Taking into account the spread of COVID-19 amidst increasing protectionism and nativism, a portion of the 2020 budget has been geared towards cushioning the impact from such uncertainties.[9] The government has set aside S$800 million from the 2020 national budget for frontline government agencies to cope with the virus.[10]

COVID-19: Stabilisation & Support Package (S$4 Billion)[edit | edit source]

The government has allocated S$4 billion out of the S$106 billion budget to help sectors who have been financially hit by the virus.[11] The sectors that are predicted to be impacted by COVID-19 outbreak are listed below.

Aviation[edit | edit source]

In February 2020, Singapore Airlines announced that it plans to cancel flights globally until May 2020. The aviation sector is one of the beneficiaries of this package.

Changi Airport will receive a 15% property tax rebate. Additionally, there will be rebates for aircraft parking and landing charges.[12] Shops and cargo agents at Changi Airport will also receive rental rebates.[13]

Tourism[edit | edit source]

Tourist venues like the Marina Bay Sands (pictured) will receive varying degrees of property tax rebates.

Companies in the tourism industry will qualify for a Temporary Bridging Loan Programme (starting March 2020). These firms are allowed to borrow up to S$1 million (with a 5% annual interest rate) if need be.[14] The following venues qualify for property tax rebates in light of the COVID-19 situation.

Venues Property Tax Rebates (%) Refs.
Hotels & Service Apartments 30% [15]
Suntec Singapore Convention and Exhibition Centre (MICE)
Singapore Expo (MICE)
Changi Exhibition Centre (MICE)
Cruise & ferry terminals 15%
Integrated Resorts 10%

Point to point services[edit | edit source]

The government has given S$45 million to fund the Point-to-point Package. Taxi and private-car operators will fund the remaining S$32 million.[16] This package is meant to help taxi and private hire drivers who have reported lesser passengers daily due to the COVID-19 outbreak. Eligible drivers will be given S$20 per car, per day for three months to defray the lost income caused by lesser passengers.[17]

Food services & Retail[edit | edit source]

The government has implemented rental waivers to alleviate the costs borne by shop owners.

Beneficiary Rental Waiver Government Agency Refs.
Hawkers & Market stallholders Full-month National Environment Agency (NEA) [18]
Commercial shop owners Half-month Housing Development Board (HDB)

Eligible commercial properties will also receive a 15% property tax rebate.[19]

For Singaporeans[edit | edit source]

Care & Support Package (S$1.6 Billion)[edit | edit source]

Payouts[edit | edit source]

With this package, Singaporeans are to receive the following payouts in 2020.

Beneficiary Payout (S$) Refs.
All Singaporeans $100 - $300 (depending on individual income) [20]
Singaporean parents (with children below 21 years old) + $100 [21]
Low-wage workers and self-employed individuals (35 years old & above) + Min. $100 (Workfare Special Payment) [22]

Housing Rebates[edit | edit source]

Households living in HDB housing can get rebates under the Care & Support Package. Photo from AsiaOne.

As part of the Care & Support Package, residents living in HDB public housing are also to receive Service and Conservancy Charge Rebates.[23] The following is a breakdown of the rebates given.

Housing Type Rebate Value Refs.
1 or 2-room flats 3.5 months worth of rebates [24]
3 or 4-room flats 2.5 months worth of rebates
5-room flats 2 months worth of rebates
Executive or multi-generation flats 1.5 months worth of rebates

Additional Initiatives[edit | edit source]

The following initiatives will only apply to eligible households and individuals:

  • Yearly GST voucher to be doubled in amount[25]
  • Larger households (ie. 5 or more members) to receive additional GST vouchers
  • Low-income families to receive grocery vouchers worth S$100 in 2020 and 2021[26]
  • Singaporeans above 50 years old to receive a one-time top-up of S$100 to their PAssionCard[27]

Other than the above, the government has also set aside the following funds:

  • S$10 million of the S$1.6 billion to Self Help Groups[28]
  • S$20 million of the S$1.6 billion to Community Development Councils[29]

Assurance Package (S$6 Billion)[edit | edit source]

GST will not be increased (from 7 to 9%) in 2021. Photo from The Straits Times.

The government has allocated S$6 billion to an Assurance Package to help Singaporeans cope with the GST hike that is scheduled for 2025.[30][31]


Under this package, every adult Singaporean will receive cash payouts ranging from S$700 - S,$1600 over 5 years from when the package is introduced.[32] This sum is meant to offset minimally 5 years worth of expenses incurred as a result of the GST hike.

More funding for existing schemes[edit | edit source]

The following schemes will receive more funding from the government.

Scheme Government Top-Up (S$) Beneficiary Refs.
SkillsFuture Credit Top Up + $500 (per person) Singaporeans [33]
SkillsFuture MidCareer Support Package + $500 (per person) (i) Employed Singaporeans

(ii) 40 - 50 years old

[34]
Silver Support Scheme + $290 million (i) Bottom 20% of Singaporeans

(ii) 65 years old & above

[35]
MediFund + $200 million Singaporeans unable to afford subsidised medical bills [36]
Eldercare Fund + $750 million Elderly requiring healthcare [37]
ComCare Fund + $500 million Low-income individuals and families [38]
MOE Financial Assistance Scheme (FAS) + $9 million Singaporean students [39]
Global Talent Ready Programme Amount Undisclosed Singaporean students [40]

The following schemes are also to be enhanced.

  • Silver Housing Bonus and Lease Buyback Scheme: Individuals under this scheme will be provided with risk-free interest rates on their savings.[41]
  • CPF Housing Grant: Eligible first- time flat buyers can receive up to S$160,000 in housing grants.[42]
  • Central Provident Fund (CPF) Basic Retirement Sum: The next two cohorts of retirees will enjoy an increased Basic Retirement Sum from S$90,500 (2020) to S$93,000 (2021) and S$96,000 (2022).[43]

For companies & employees[edit | edit source]

The government has set aside S$8.3 billion to kickstart the transformation of enterprises and businesses in Singapore.[44] Certain new schemes such as the Jobs Support Scheme (JSS) are also meant to protect the interests of employees. The newly introduced initiatives target a range of beneficiaries - from Small Medium Enterprises (SMEs) to Trade Associations and Chambers (TACs).

New initiatives[edit | edit source]

Initiative Beneficiary Incentive Refs.
Jobs Support Scheme (JSS) Singaporeans, PRs Employers can claim up to 8% of each local employee's monthly wages* from October 2019 - December 2019.

*Capped at $3,600 per month.

[45]
Employers
Corporate Income Tax Rebate Companies The government will offset 25% of the payable tax for eligible companies. The rebate is capped at S$15,000 per company. [46]
StartupSG Equity Tech start-ups The government has allocated S$300 million to support this sector. [47]
Heartland Enterprise Upgrading Programme Heartland Enterprises The government has allocated funds for up-skilling workers and improvements in infrastructure. [48]
Executive-in-Residence Programme TACs The government will provide funding for TACs to hire experienced executives who can provide industry advice. [49]
Enterprise Transform Package SMEs The package includes a 3-year programme that is meant to groom and train the business leaders of 900 companies. [50]

Existing initiatives[edit | edit source]

The following existing schemes will be enhanced.

Scheme Target Audience New Incentives Refs.
Wage Credit Scheme Employers 5% increase in government co-funding levels for employee wage increases. [51]
Singaporean Employees Workers earning up to S$5,000 will benefit from the Wage Credit Scheme. [52]
Enterprise Financing Scheme Companies Companies can get up to S$600,000 of the working capital loan - double the amount of 2019's maximum loan. [53]
The government's risk share will increase to 80%.
Enterprise Development Grant Small-Medium Enterprises About 3,000 SMEs will be supported by this grant in 2020. [54]

Climate change: Incentives, Funds & Programmes[edit | edit source]

The government has dedicated funds to address climate change in Singapore. The new big-ticket investments are the Coastal & Flood Protection Fund as well as a close to S$1 billion injection into research in sustainability and urban solutions.[55]

Coastal & Flood Protection Fund (S$5 Billion)[edit | edit source]

The Coastal and Flood Protection Fund is one of the initiatives targeting climate change in Singapore. Photo from Yahoo! News.

The Singapore government has set aside S$5 billion out of the S$106 billion budget for this fund.[56] This initiative is meant to keep Singapore safe from the threat of rising sea levels.[57]

EV Early Adoption Incentive[edit | edit source]

Individuals who buy electric vehicles (EV) will receive a 45% rebate on the additional registration fee. This incentive is effective from January 2021 and the rebate is capped at S$20,000.[58] This incentive is part of the government's goal to eradicate Internal Combustion Engine (ICE) vehicles by 2040.[59] Additionally, the government aims to have 28,000 EV charging ports islandwide by 2030. This is 17.5 times more than what Singapore has in 2020.[60]

Commercial Vehicle Emissions Scheme[edit | edit source]

There will also be a Commercial Vehicle Emissions Scheme. This scheme builds on the success of 2018's Vehicular Emissions Scheme (VES) where car-buyers and taxi operators are given a S$20,000 - $30,0000 rebate for choosing cleaner car models.[61]

HDB Green Towns Programme[edit | edit source]

The HDB Green Towns Programme will ensure that greenery and tree cover will make up 45 - 60% of new HDB developments.[62] In general, the programme has three goals, to (i) Cool down HDB estates, (ii) Recycle rainwater and (iii) Reduce energy consumption.

References / Citations[edit | edit source]

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