Solidarity Budget 2020: Further support for businesses through the circuit breaker period
During this circuit breaker period, many firms may not be able to operate or can only operate at a much reduced level. To help businesses preserve their capacity and capabilities so they can hit the ground running once the circuit breaker is lifted, Deputy Prime Minister and Minister for Finance Heng Swee Keat announced additional support on 6 Apr 2020.
Here’s a breakdown of the support businesses can receive from the Solidarity Budget, as well as a recap of the earlier announced Unity Budget and Resilience Budget.
Unity Budget [announced 18 Feb 2020]
Support for Businesses
- Stabilisation & Support Package
- Jobs Support Scheme
- Enhanced Enterprise Finance Scheme-SME Working Capital Loan
- 25% Corporate Income Tax Rebate for the year 2020, up to $15,000 per company
- Transformation and Growth
- $8.3 billion allocated over the next three years for Transformation and Growth
- Additional $300 million under Startup SG Equity for deep-tech startups
- Enterprise Grow Package
- Launched GoBusiness platform, a single touchpoint for Government-to-Business transaction
- Expanded SMEs Go Digital programme to drive greater adoption of digital technology
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- Enhanced Market Readiness Assistance grant to help more enterprises enter new markets
- Enterprise Transform Package
- Training and mentorship for businesses leaders of 900 enterprises, through Enterprise Leadership for Transformation programme
Expanding Enterprise Development Grant to support 3,000 business transformation projects
Resilience Budget [announced 26 Mar 2020]
Support for Businesses
1. Help with cash flow
- Accelerated flowing of payouts under wage support schemes (a total payout of $5.6 billion by end-May 2020)
- Brought forward additional $500 million of wage credits
Automatic deferment of income tax payments for 3 months for companies and self-employed persons
2. Help with business costs
- Enhanced Property Tax Rebate
- No Property Tax for 2020 for qualifying commercial properties (up from 15% – 30% Property Tax Rebate)
- 30% Property Tax Rebate for 2020 for businesses in other non-residential properties affected
- Rental waivers of up to 3 months for stallholders in hawker centres managed by National Environment Agency (NEA) or NEA-appointed operators, eligible tenants under government agencies and all other non-residential tenants
- One-year freeze on all government fees and charges, from 1 April 2020 to 31 March 2021
- Help with credit
- Enhanced Enterprise Financing Scheme (EFS) – Trade Loan with maximum loan quantum of $10 million (up from $5 million) and Government’s risk-share of 80% (up from 70%)
- 80% subsidies to businesses for loan insurance premiums under the Loan Insurance Scheme (up from 50%)
- Expanded Temporary Bridging Loan Programme expanded to all enterprises, with maximum supported loan of $5 million (up from $1 million)
- Enhanced EFS –SME Working Capital Loan with maximum loan quantum of $1 million (up from $600,000)
- Deferred capital payments for one year on the EFS-Working Capital Loan and the TBLP loans for businesses that request it
- $20 billion of loan capital set aside as part of the budget
- Help for loan obligations and insurance premium payments for businesses and individuals facing cash flow challenges
- Help for sectors most affected by COVID-19
- Enhanced Jobs Support Schemes for business in the aviation, tourism and food service sectors, up to 75% wage offset first $4,600 of monthly wages will be provided for every local employed
- $350 million enhanced aviation support package
- $90 million set aside to help the tourism industry rebound
- Extended and enhanced Point-to-Point Support Package for taxi and private hire car drivers, to receive the Special Relief Fund payments of $300 per vehicle per month until end-Sep 2020
- One-year road tax rebate and six-month waiver of parking charges at government-managed parking facilities for private bus owners
$55 million support package for the arts and culture sector.
Solidarity Budget [Announced 6 Apr 2020]
Businesses will receive additional help with labour and rental costs, as well as financing support during this circuit breaker period.
Help with labour costs
To help businesses retain their workers in the coming weeks when many firms may not be able to operate or can only at a much reduced level, and for business to be up and running quickly after the circuit breaker is lifted, the Jobs Support Scheme (JSS) will be enhanced. The wage subsidy for all firms will be raise to 75% of gross monthly wages for the $4,600 of wages paid in Apr 2020, for all local employees. This is up from 25% of the first $4,600 of gross monthly wages for all local employees previously.
This wage subsidy applies to every one of over 1.9 million local employees. The first JSS payout will be brought forward from May to April 2020.
In addition, help will be given to ease labour costs of employers who have hired foreign workers, to help them take care of these workers during this circuit breaker period. There will be a waiver of monthly foreign work levy due in Apr 2020, as well as a foreign worker levy rebate of $750 for each Work Permit or S-Pass holder, based on previous levies paid in 2020.
Help with rental costs
The Ministry of Law will introduce a bill to let businesses and individuals defer certain contractual obligations, such as paying rent, repaying loans, or completing work, for a period. This bill will also ensure that property owners pass on the property tax rebate in full, to tenants to ease their rental costs.
The government will increase rental waiver for industrial, office and agricultural tenants of government agencies to 1 months, up from 0.5 month’s rental waiver previously announced.
Enhanced financing support
Further enhancements to financing support for enterprises will be made so businesses can continue to have access to credit, despite uncertainties.
Government’s risk share of loans made under the Temporary Bridging Loan Programme, Enterprise Financing Scheme (EFS) – Working Capital Loan and EFS – Trade Loan will be increased from 80% to 90% for loans initiated from 8 Apr 2020 till 31 Mar 2021.
To help SMEs with temporary cash flow difficulties, the Monetary Authority of Singapore (MAS), together with the financial institutions introduced a package of measures.
Details here.
Help for self-employed persons
To provide direct cash assistance for self-employed persons the Self-employed person Income Relief Scheme (SIRS) will also be enhanced. Details here.
For more on Budget 2020, visit www.singaporebudget.gov.sg.
View the Budget booklets here
Source : https://www.gov.sg/article/solidarity-budget-2020-further-support-for-businesses-through-the-circuit-breaker-period