Deloitte Singapore’s response to Finance Minister’s Ministerial Statement on the Government’s additional support measures

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Deloitte Singapore’s response to Finance Minister’s Ministerial Statement on the Government’s additional support measures in response to the COVID-19 pandemic

SINGAPORE, 26 March 2020 – Deloitte Singapore’s subject matter experts share their reactions and comments to Finance Minister Heng Swee Keat’s statement in Parliament on the government’s additional support measures in response to the COVID-19 pandemic:

Mr LOW Hwee Chua (刘辉泉), Regional Managing Partner for Tax & Legal, Deloitte Singapore & Southeast Asia:

“This is a strong and exceptional Resilience Budget for today’s exceptional times. The focus is very clear – to protect Singapore and Singaporeans as we steel ourselves for the long haul of a potential downturn of a year or more. Finance Minister Heng Swee Keat’s approach of supporting workers, stabilising businesses and building resilience gives us the reassurance that the Government is well-prepared to go above and beyond to see us through this storm.”

Mr Daniel HO (何仁奇), Tax Partner and Tax Leader for Government & Public Services sector, Deloitte Singapore:

“Extraordinary times need extraordinary measures, to the tune of an additional S$48 billion. This is indeed a landmark package never seen before.”

“The combination of direct income support and training allowance for self-employed persons gives the peace of mind for these individuals to consider up-skilling during this expected lull period. “

“As expected, the Singapore Government is granting deferral for tax payments to preserve cash for businesses and individuals, similar to what other governments are doing. As compared to other countries such as Australia, 3 months may not seem sufficient. Nevertheless, if the situation persists, a further deferral can be expected.”

Mr LEE Tiong Heng (李忠兴), Tax Partner and Leader of Global Investment & Innovation Incentives, Deloitte Singapore & Southeast Asia:

“Deputy Prime Minister Heng Swee Keat, even in the midst of Covid 19, is pushing ahead with economic resilience by encouraging businesses to innovate and deepen capabilities. The SME Go DIgital Programme has been enhanced for more digital solutions. The Productivity Solutions Grant's and the Enterprise Development Grant's maximum support level has been raised to 80% and 90 % respectively.”

Mr Rohan SOLAPURKAR, Tax Partner and Consumer Industry Tax Co-Leader, Deloitte Singapore and Deloitte Southeast Asia:

“The Resilience Budget along with the Unity Budget has an outlay of S$55 billion. Difficult times require strong leadership and strong financial measures - both which are visible through the measures put forth by the Government.”

“The SGUnited Traineeships programme is a wonderful move that gives confidence to graduates as well employers.”

“The one year freeze on all Government fees and charges, and the deferral of student loans and interest will put additional cash in pocket of Singaporeans. This is very welcome.”

Ms LIEW Li Mei (刘丽梅), Tax Partner and International Tax Leader, Deloitte Singapore:

“Wow, a generous supplementary package indeed which is much welcomed at these unprecedented times!”

“The Government has targeted two of the biggest expenditure for companies and businesses - salaries and rental cost, to help them where it matters most.”

Ms Sabrina SIA (佘爱玲), Tax Partner and Leader of Global Employer Services, Deloitte Singapore:

“The self-employed have been significantly impacted by the downturn caused by Covid-19 and will welcome the relief provided by the three month deferment of tax payments. Employees will be disappointed that they don't have an automatic extension but will have some comfort that they can apply to IRAS for a deferment on a case by case basis.”

“As expected, relief to individuals was not given in terms of income tax rebates as rebates will not help the lower income earners who do not pay taxes. The Government instead announced higher cash payouts of between S$300 to S$900 for all adult Singaporeans depending on income as well as additional cash payouts for parents with young children. This should help to provide temporary relief to households with their living expenses during this trying period.”

Ms ONG Siok Peng (王淑苹), Tax Partner and Tax Leader for Transportation, Hospitality & Services sector, Deloitte Singapore:

“The Government has gone all out to try to save the jobs of Singaporeans, not forgetting the self-employed persons - indeed an extraordinary measure.”

“Many of the retailers have to rely on landlords to pass on the property tax rebates to them. It would have been helpful if the higher support that will be provided to the food services sector and aviation and tourism sector with co-funding of wages of 50% and 75% respectively, is also extended to retailers which the government had earlier identified to be also one of the most affected sectors.”

Mr LEE Chew Chiat (李招杰), Government & Public Services Sector Leader, Deloitte Southeast Asia:

“I am proud that our Government is the first government in the world to come up with such a comprehensive package to help our workers, companies and the society during uncertain times.”

“As a nation, we are able to fund the Resilience Budget only with good governance, prudence, a vibrant economy and a united people. We are spending our reserves. We should use the funds to prepare ourselves for the upswing when the economy improves.”

“This unprecedented supplementary Budget is a big boost to companies in not just sustaining their business operations, but if used properly, it can help position them strategically as their competition grapple with shocks and problems.”

Mr Mark TEOH (赵子华), Organisation Transformation Leader, Human Capital Consulting, Deloitte Southeast Asia:

“This $48 billion stimulus package – in line with what most other countries are doing - seems measured and sustainable.”

“This package provides targeted and precise help to industries most heavily impacted (for example 75% and 50% co-funding of wages for aviation/ hospitality and F&B sectors respectively). This is quite far-reaching and likely to reassure employees and employers, and stabilize the situation in those sectors. It is a strong sign of support from the government and shows the government understands the economic impact by industry.”

“There is help for the unemployed in form of virtual career fair focusing on short-term temporary jobs. This creates jobs around the spike in short-term labour demand as a result of COVID-19 in healthcare screening and triage-related areas, This is very promising and a clever way of leveraging existing work platforms, but the effectiveness will depend on largely minimizing time-lag in matching jobs to worker.”

Mr James WALTON, Transportation, Hospitality and Services Sector Leader, Deloitte Singapore and Southeast Asia:

“A welcome - and significant - boost for the tourism and aviation sectors. The 75% Enhanced Jobs Support Scheme with the increased wage ceiling will be critical for companies facing prolonged closures. The sector support packages look promising but ultimately much will depend on how long the crisis continues and then how quickly confidence is restored.”

“Self-employed and gig economy workers will be much happier with Budget 2.0 than they were with the 1.0 version. The income relief payment and the deferment of tax payments will help critical cashflow for the next few months as we all hope for a quick recovery and economic rebound.”

Mr PUA Wee Meng (潘伟铭), Consumer Industry Leader, Deloitte Southeast Asia:

“Many economists have asked governments around the world to be bold, to act fast and do whatever it takes at this unprecedented time to address the challenges faced by businesses. The Singapore government has indeed responded decisively, bringing out the ‘big artilleries’ to help companies tide over this crisis. This supplementary package is especially important for the aviation and tourism sectors which are badly impacted by border closures and travel restrictions. While the supplementary package provides short term relief in terms of cash flow and ability to preserve employments, companies in these sectors have to continue looking at long term measures, including assessing their business models, to sustain themselves for the long haul given the uncertain situation and be ready to emerge stronger when the crisis is over.“

Press contact:

Carie-Anne Bak
Deloitte Singapore
Marketing & Communications
+65 6531 5203
cabak@deloitte.com

Marie Li
Deloitte Singapore
Marketing & Communications
+65 6800 3717
meijli@deloitte.com

June Yeo
Deloitte Singapore
Marketing & Communications
+65 6800 3937
juneyeo@deloitte.com

 

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