8 Ways That Businesses Can Benefit from Budget 2017
The Singapore Budget 2017 is remarkable for wide-ranging support of small and medium enterprises (SMEs). Here’s a look at 8 initiatives and measures that business owners could benefit from.
When finance minister Heng Swee Keat delivered Singapore’s Budget 2017 speech on February 20, he unveiled a slew of programmes and measures to support businesses in developing deep capabilities to weather challenges and stay competitive in the new economy. Key on the government’s agenda is assisting Singapore businesses to embrace digital technology, foster innovation and scale up. Here are eight ways for SMEs and start ups to benefit from this year’s Budget.
1. Go digitalNow is the time for businesses to get up to speed with the digital revolution. Recognising the importance of incorporating digital technology in businesses, an $80 million SME Go Digital Programme has been established to offer enterprises step-by-step advice on the technologies to use at each stage of their growth. Heng has identified businesses in retail, food services, wholesale trade, logistics, cleaning and security as industries where technology can significantly improve productivity, so find out what digitalisation upgrades your company adopt in these sectors.
To smoothen the transition, SMEs can consult business advisors at SME Centres, where they can receive advice on off-the-shelf technology solutions that have been pre-approved for funding support or connect with relevant vendors and consultants. Specialist advice will also be available for more digitally advanced firms from the newly established SME Technology Hub.
2. Encourage employees to learn for the futureEmployees with skillsets that are relevant in the new economy and who continually upgrade their skills are assets to a company. The government recognises the need for a skilled and adaptable workforce and will continue to invest heavily in this area, so encourage employees to take advantage of the various schemes available.
The SkillsFuture training scheme continues and the government will be offering more short, modular courses and expand the use of e-learning to cater to a wider range of workers. Businesses who are grooming leaders will want to take a look at the new SkillsFuture Leadership Development Initiative, which offers development programmes such as sending promising individuals on specialised courses and overseas postings.
3. Innovate and create for the cutting edge economyInventors, creators and entrepreneurs will benefit from the government’s generous allocation of resources to foster innovation, with more support becoming available to firms investing in new technology and applications. A*STAR’s Headstart Programme to co-develop royalty-free intellectual property will be extended to 36 months from its current 18 months. In addition, SMEs will not only have access to advanced machine tools for prototyping and testing, which may require costly specialised equipment, but can get user training and advice under the new Tech Access Initiative.
4. Enjoy tax rebates and employee supportBusinesses in Singapore will certainly appreciate the enhancement of the Corporate Income Tax Rebate. The cap has been raised by $5,000 to $25,000 for 2017 with a rebate of 50 per cent of tax payable. The rebate will also be extended to 2018 at a reduced rate of 20 per cent of tax payable, capped at $10,000. These enhancements will cost an additional $310 million over these two year.
The Wage Credit Scheme, where the government co-funds 20 per cent of wage increases given to each Singaporean employee earning a gross monthly wage of up to $4,000, will continue this year. With about 70 per cent of an estimated $600 million payout going to SMEs, this scheme is particularly useful in helping enterprises in coping with rising wages.
5. Hire older (more experienced) workersDo make use of the Special Employment Credit to hire older employees, which provides salary offsets to employers hiring workers aged 55 and above and who earn up to $4,000 a month. The re-employment age has been raised from 65 to 67 years to cover a larger group of older workers. On top of this, the Additional Special Employment Credit has been extended till end 2019, which means businesses may be able to receive support of up to 11 per cent for wages of eligible older workers. Consider this a good opportunity for SMEs to benefit from keeping experienced workers in their businesses.
6. Do invest in your own businessTaking out a loan for your company can be a financial burden, which is why the government introduced the SME Working Capital Loan. This scheme, where the government co-shares 50 per cent of the default risk for loans of up to $300,000 per SME, will continue for the next two years. Minister Heng says there has been a good take-up for this scheme, with over $700 million of loans catalysed since its launch in June 2016, so consider this option if you are planning to grow your business.
7. Be assured of cybersecurityCybersecurity is essential in ensuring that essential data is protected in this digital age. Along with investing in digital technology, the government also recognises the necessity to strengthen Singapore’s cybersecurity capabilities and the Cyber Security Agency of Singapore will work with professional bodies to train cybersecurity professionals. This will ensure that the country’s cyber borders and infrastructure remains secure for businesses..
8. Expand globallyNow is the chance for ambitious firms to expand your presence overseas. To encourage and help enterprises scale up globally, the government is setting up a slew of programmes, including the Global Innovation Alliance and the International Partnership Fund. The Alliance aims to facilitate innovation and collaboration overseas by establishing networks for entrepreneurs to connect with mentors, investors and service providers. There will also be more support for companies to link up with foreign firms within Singapore to expand in the region. Plus, the $600 million International Partnership Fund will co-invest with Singapore-based firms to help them scale-up internationally.
With plenty of business-friendly initiatives, it is no wonder SIngapore is often called the gateway to the region – and the world – in business circles. Take the first step to starting your enterprise in Singapore now.
Find out more about how Hawksford Singapore can assist you in your journey to entrepreneurship here.