Page 4 - RSM Budget 2020 Highlights

FOREWORD

Budget 2020 contains two key thrusts. First, the introduction of the Stabilisation and Support Package to address
near-term challenges over economic uncertainties and the COVID-19 outbreak. Second, a set of Transformation
and Growth strategy measures to support the longer-term plans to position Singapore as the Global-Asia node of
technology, innovation and enterprise.

The Stabilisation and Support Package is aimed at stabilising the economy, putting in more cash in the hands of
enterprises to ease their cash flow and helping our workers stay employed during these uncertain times. The
support is greatest for industries such as tourism, aviation, retail and food services which are directly impacted by
the COVID-19 crisis. Other business sectors impacted by the ripple effects of the crisis and the resultant disruptions
to their supply chains also benefit from these measures.

The initiatives introduced to weather the near-term economic uncertainties include temporary bridging loans,
corporate tax and property tax rebates, carry back of losses to two more prior years, faster write-off of plant and
machinery, renovation and refurbishment expenditure incurred this year.

The Job Support Scheme, a 8% wage offset for three months, was introduced to help employers to defray staff cost
and keep employees in their workforce. The level of wage co-funding by the Government for the Wage Credit
Scheme was also increased to encourage businesses to continue with their transformation efforts and share
productivity gains with employees.

Whilst tackling these near-term challenges, the Government has not lost sight of the longer-term plan to
transform the economy. Three key thrusts were announced to drive the longer-term Transformation and Growth
strategy; viz. (a) enabling stronger partnerships within Singapore and across the world, (b) deepening enterprise
capabilities and (c) developing capabilities of our people.

As a small and open economy, Singapore must continue to strengthen the partnerships with the world via various
channels of economic linkages. Beyond economic connectivity, the Finance Minister also emphasized on the value
creation of digital economy. Digitalisation has transformed business models and trade. This has opened up
unparalleled opportunities for enterprises and consumers. Enterprises that are able to navigate and tap into
international markets in the new digital environment will have a competitive advantage.

The second thrust for the transformation is to deepen capabilities of enterprises by innovating, digitalising and
venturing overseas. The Government is committed to support enterprises at each stage of their growth; starting
up, growing and transforming. There are enhancements to various initiatives such as the Deep-tech Start-ups for
starting up and Enterprise Grow Package to help with venturing into new markets.

The third thrust of the economic transformation is to develop and deepen our people’s capabilities to enable them
to access good jobs, earn good wages and stay employable. There are various Government support programmes
to encourage lifelong learning, skills upgrading and reskilling in order to stay relevant and employable. The 70-70
target for students to acquire cross-cultural skills and understand our region (ASEAN, China or India) better was
introduced. A brand new SkillsFuture Enterprise Credit was introduced to encourage employers to embark on
transformation of enterprise and their workforce in tandem.

Singapore has always prided itself on, amongst others, strong rule of law, an open economy and a well-trained high
quality workforce. These fundamentals have distinguished Singapore and they must continue to be built on for us
to ride the next wave of structural changes resolutely.

Cindy Lim

Partner
18 February 2020

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