Tuesday, February 23, 2010

Singapore Budget 2010 in a nutshell

First, some candies that look sweet on paper...

Singapore govt unveils slew of tax reliefs for households
Source: Channelnewsasia.com

For a start, those taking care of their parents and grandparents can expect greater tax relief of up to S$7,000.

Wives who are taxpayers can also claim a spouse relief of S$2,000 - similar to the current scheme for husbands.

The income threshold for dependant-related reliefs will also go up from S$2,000 to S$4,000.

For the elderly, there will be a one-off top-up of the CPF-Medisave Accounts of older Singaporeans aged 50 and above.

The Medisave top-up will benefit about one million Singaporeans and cost the government S$310 million.

An additional S$200 million will also be set aside for Medifund - which supports needy Singaporeans - and another S$200 million for the ElderCare Fund to meet longterm healthcare needs.

For families with children, they can look forward to further top-up of the Post Secondary Education Accounts (PSEA).

And for the big P that our big bosses have been bringing up as often as Wonder Girls' "Nobody" was on radio...

Singapore to commit S$5.5b to help workers & firms raise productivity
Source: Channelnewsasia.com

To achieve the productivity growth targets, Mr Tharman laid out three plans:

1) Restructure the economy towards higher-value activities and depart from less efficient ones;

2) Upgrade individual industries and enterprises; and

3) Raise the skills and expertise of each worker.

To help companies - especially small and medium enterprises - invest in innovating their work processes, the government will introduce a Productivity and Innovation Credit scheme.

Under the scheme, companies will get significant tax deductions when they invest in a broad range of activities such as automation through technology and design, and staff training.

Businesses can deduct 250 per cent of their expenditures on each of the activities from their taxable income, up to a cap of S$300,000.

To emphasise how serious the government is in improving skills and productivity nation-wide, Deputy Prime Minister Teo Chee Hean will chair a high-level National Productivity and Continuing Education Council.

The council will come up with priority areas and programmes to tap on a new S$2 billion National Productivity Fund. For a start, the fund will have an initial sum of S$1 billion to support initiatives over the next five years.

The rich staying in houses with an annual value of about S$80,000 will see a tax increase of "slightly less than S$100" a year, while taxes for non-owner-occupied residential properties remain at 10 per cent so that there should be no impact on those who buy for investment. Guess the rich ones must be giving great sigh of relief.

A more nuanced, fairer property tax
Source: Channelnewsasia.com

From next year, if the flat or private property you live in and own has an annual value of S$65,000, you will pay up to S$240 less in property taxes.

The new progressive property tax system, announced on Monday to the surprise of many, will see owner-occupiers exempted from tax on the first S$6,000 of the annual value - that is, the estimated rent - of their homes.

The trade-off? The S$25-to-S$150 in GST rebates, which owners of properties with lower annual values have been enjoying since 1994, will be scrapped.

The more nuanced tax system for owner-occupied residential properties will benefit all Singaporeans except the ultra-rich - those living in properties with over S$77,000 annual value. They comprise only 0.4 per cent of all owner-occupied homes in Singapore, and only 3 per cent of private owner-occupied homes here, said Finance Minister Tharman Shanmugaratnam, who also noted that the change would cost the Government S$230 million initially.

With such minor increase in levies, guess the China women will still be here to steal the kopitiam jobs from aunties and the IRs can continue to employ foreign workers...

Foreign worker levies to go up from July
Source: Channelnewsasia.com

For a start, levy rates will go up between $10 to $30 for most Work Permit holders on July 1 this year. Adjustments will be made in 2011 and 2012.

In the next three years, companies can expect a gradual total increase of about $100 on average per worker in manufacturing and services.

The construction industry will see a larger increase, according to the minister.

Changes will also be made for S Pass workers, with two levy tiers instead of one. The rates for the first and second tiers will be $100 and $120 in July this year - going up from a single rate of $50 currently.

Further adjustments will be made till rates reach $150 and $250 by July 2012.

This is so that tourists can buy more and cheaper liquor to drink themselves drunk when they lose all they money at the Integrated Resorts, instead of robbing other tourists at the airport...

Wine and beer lovers can drink to this
Source: Channelnewsasia.com

In his Budget statement on Monday, Finance Minister Tharman Shanmugaratnam said travellers will be able to buy an additional litre of duty-free wine or beer in place of one litre of duty-free spirits. This means that those who prefer wine or beer will be able to enjoy a duty-free allowance of two litres of wine and one litre of beer, or two litres of beer and one litre of wine.

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