On 20 February 2017, Finance Minister, Mr Heng Swee Keat announced the Singapore Budget 2017.
The following comments are responses from BDO Singapore on Singapore Budget 2017.
“Despite the increasing anti-globalisation sentiment in the west that will not benefit open economies like Singapore, this year’s Budget seeks to continue investing in economic infrastructure, while encouraging businesses to innovate, digitalise and globalise. The initiatives introduced will create an economy, one that is connected to the world while providing opportunities for Singapore and our local enterprises.”
Frankie Chia, Managing Partner
“As we gather momentum into the next milestone of nation building, digitalising our economy will be the way forward. Embracing technology advancement will improve the way of life for Singaporeans and businesses alike.”
Peter Leong, Partner, Head of Audit & Assurance
“Although the Budget has provided some relief for companies with the continuation of wage credit scheme, it has fallen short of expectations of many SMEs to have PIC scheme extended as well.”
Ng Kian Hui, Partner, Audit & Assurance
"A prudent, forward looking and caring Budget which seeks to balance the needs of businesses, community and environment. The many measures announced to help SMEs build their digital capability, scale up to internationalise and innovate are indeed heartening, preparing them for the current headwinds and challenges ahead. At the same time, there are initiatives to improve the people’s capability, help them stay relevant and enhance their employability. Green tax is also another highlight of this year’s Budget!"
Evelyn Lim, Executive Director, Tax Advisory
“The personal income tax rebate largely benefits the middle income taxpayers who are paying tax, albeit small amount. Though the rebate may not benefit the lower income earners, other forms of help will be given such as GST vouchers and other household reliefs. However the total relief cap of $80k introduced last year remains a let-down, especially for working mothers.”
Wong Sook Ling, Executive Director, Tax Advisory
“There is little offering in both the budget statement and in the annexes that will be of interest to foreign MNCs looking to invest in Singapore. That said, Singapore still remains a very attractive destination for foreign investment but this budget will neither improve nor diminish Singapore’s position as a destination for foreign investment.”
Kylie Luo, Executive Director, Tax Advisory
“Given the "goodies" offerred in past years' budget for businesses looking at M&A deals and going abroad, we have expected none for Budget 2017. I continue to be optimistic that with Singapore being in the forefront for M&A activities locally and in the region, companies looking at business expansion may continue to find it attractive to carry out M&A activities and internationalise abroad.”
Chay Yiowmin, Partner, Head of Corporate Finance
“In view of the bleak economic outlook, it is within expectations that Budget 2017 did not surprise the public with a hike in GST rate. Nonetheless, with Mr Heng Swee Keat indicating the need to raise revenue through new taxes or raise tax rates to fund public expenditure, an increase in the GST rate in the next couple of years seems inevitable.”
Eu Chin Sien, Executive Director, Goods and Services Tax
“While the government acknowledges the need to adjust the GST system due to increasing digital transactions and cross-border trade, it is disappointing to note that nothing addressing the GST leakage in digital economy is announced in Budget 2017. Given that businesses are seeing shifts in their operational models and a surge in online transactions over the years, focus should be directed on implementing GST guidelines as Singapore thrives to becoming a digital nation."
Yvonne Chua, Associate Director, Goods and Services Tax
"This is indeed a prudent step towards a long term view of the economy. Measures taken are in view of the recommendations by the CFE and as compared to previous economies’ reviews, the government has definitely taken concrete implementation action steps, rather than just macro-level strategic statements. However, many expect but are disappointed by the lack of directive initiatives in addressing the immediate uncertainty surrounding SME’s owners. Taking for instance, building digital capabilities is the way forward but government will do well to address to the SMEs that it is beyond iPad, photocopy machines and a fancy website. E-commerce is just the tip of the iceberg of a digitisation strategy. Where and how the money is being invested to build such capabilities for SME will be the focal point in the days ahead. At the same time, SMEs must also view the proposed changes to diesel and water taxes and tariffs as the government’s strong resolute in pushing for productivity and shared services platforms. For example, with the revised tax changes to diesel, many SMEs with fleet of diesel driven vehicles will be forced to reconsider the option between owing the fleet themselves or working in collaborations with other SMEs to create a shared platform where cost savings and productivity could be achieved. This is the budget for tomorrow – as of many budgets before it – it is meant for reap the fruits in the long term and those seeking for immediate ratifications to their current woes will be disappointed."
Roger Loo, Executive Director, Management Consultants
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