*Updated on 21 April 2020
The Singapore government unveils the details of the third round of Budget measures to help businesses and individuals through the Covid-19 situation. The additional measures will cost $5.1 billion, with $4 billion for additional support for businesses and workers, and $1.1 billion for the Solidarity Payment.
Circuit breaker measures were put in place and will run for 4 weeks from 7 April to 4 May. During this time, all non-essential businesses and operations will be put to a halt.
The gross domestic product (GDP) growth is expected to take a further hit. To overcome the immediate challenges of Covid-19, the third tranche of measures will include additional cash payouts, additional support to alleviate business costs and enhanced financing support to facilitate access to credit.
Cash
Self-employed persons, including entrepreneurs can benefit from the Self-Employed Person (SEP) Income Relief Scheme. The current Annual Value (AV) threshold of $13,000 was raised to $21,000 to support more SEPs. Eligible SEPs will receive three quarterly cash payouts of $3,000 each in May, July and October 2020.
Cost
The enhanced Job Support Scheme (JSS) will pay 75% of the first $4,600 of monthly wages paid in April 2020 for every local worker in employment. Firms will receive the first payout in April 2020. Subsequently, the wage support will cover 75% of the first $4,600 for the aviation, accommodation and tourism sectors, 50% for food services sectors and 25% for all other sectors for eight months until the end of 2020.
Foreign Worker Levy due in April 2020 will be waived. There will also be a Foreign Worker Levy Rebate of $750 in April 2020 from levies paid this year for each Work Permit or S Pass holder.
Landlords will get up to 100% of Property Tax Rebate for non-residential properties. Hotels, serviced apartments, MICE premises, Changi Airport, cruise centres, cinemas, restaurants, shops, tourist attractions, childcare centres or kindergartens and purpose-built workers’ dormitories will get 100% Property Tax Rebate in 2020.
Integrated resorts – Marina Bay Sands and Resorts World Sentosa will be entitled to 60% property tax rebate. A 30% rebate for property taxes will be given to all other non-residential properties such as offices, business or science parks, industrial properties and petrol stations.
The government will introduce the Covid-19 (Temporary Measures) Bill to ensure the pass-through of Property Tax Rebate from property owners to tenants. The bill will also defer certain contractual obligations, such as paying rent, repaying loans, or completing work, for a period.
Rental waivers for industrial, office and agricultural tenants of Government agencies will be increased from 0.5 month to 1 month. Stallholders in hawker centres managed by the National Environment Agency or NEA-appointed operators will get three months of rental waivers while commercial tenants will receive two months of rental waivers.
Credit
Financing support for enterprises will be further enhanced so that viable businesses can continue to have access to credit despite the uncertainty.
Government’s risk share of loans made under the Temporary Bridging Loan Programme, the Enterprise Financing Scheme – SME Working Capital Loan, and Enterprise Financing Scheme – Trade Loan will be increased from 80% to 90% for loans initiated from April 8, 2020 till March 31, 2021.
The Monetary Authority of Singapore (MAS), together with the financial institutions, also introduced a package of measures to help small and medium enterprises (SME) with temporary cashflow difficulties. SMEs can now opt to defer principal payments on their secured term loans till the end of the year.
The Government’s response to Covid-19 will total $59.9 billion, or about 12 per cent of GDP. The overall budget deficit for FY2020 will increase to $44.3 billion (8.9 per cent of GDP).
Update
On 21 April 2020, the Singapore government announced that the circuit breaker measures will be extended to 1 June 2020. Enhanced circuit breaker measures will be in place for minimally a two-week period from 21 April 2020 until 4 May 2020. More non-essential services, including specialty food and beverages outlets, amenities in gardens, parks and nature reserves, as well as hairdressing and barber shops will be closed. Pet supplies stores and laundry shops will continue operations online only. Veterinary, plumbers, electricians, vehicle recovery and repair will provide emergency services only.
An additional $3.8 billion will be set aside to support businesses and workers. The Government will extend JSS for the month of May to cover the 75% of the monthly wages for local employees across all sectors. The JSS will also be enhanced to include employees who are shareholders and directors of their companies registered on or before April 20 this year and had an assessable income of $100,000 or less in FY2019. Foreign Worker Levy waiver and Foreign Worker Levy rebate of $750 will continue for the month of May, to ease labour costs of firms that employ foreign workers in this period.