Each year when the budget is announced, the government of Singapore focuses on balancing the priorities through a combination of both long-term and short-term measures that can help support the economy. Singapore budget 2021 is no exception as the government is again responding to the immediate short-term needs of families, workers, businesses that have been hit hardest by the Covid-19 pandemic.
As much as Covid-19 has disrupted business models and global supply chains; it has also accelerated digitalization which to a great extent presents new areas of growth that Singaporean citizens can explore. Singapore has in the past year incurred a strange budget deficit and the government continues to offer economic support in the face of an extended downturn that has come up as a result of Covid-19 pandemic. The government has announced a sizeable budget stimulus which then makes this year a bit unusual as Singapore continues to draw from the past reserves for another consecutive year.
Singapore is expected to register a budget deficit of S$11 billion this year which is about 2.2% of the GDP and this should be in addition to S$64.9 billion which is the deficit for the 2020 fiscal year, the largest to be realized since Singapore’s independence. The budget 2021 has prioritized the need to set apart targeted support to the business sectors and the various segments of society that are hardly hit and continue to struggle due to the pandemic. The move is combined with the long-term goals such as a range of initiatives that are designed to encourage global partnerships, business innovation, and digital transformation for the local businesses.
In order to position your company for growth; ensure that you have in depth understanding of what the budget entails. Working with a reputable corporate service provider in Singapore can help break down some of the key highlights of the budget that can have an impact on your business. The Minister for Finance announced in the budget that there will be an S$11 billion Covid-19 Resilience Package. This amount is meant to specifically go towards safeguarding public health including the provision of vaccination and ensuring continued support for the workers and businesses that are hardest hit by the pandemic.
Such a move is quite different from the broad-based support that the government provided last year to the sectors that have been hardest hit by the pandemic. The government continues to provide support to workers and businesses through an extension of the Job Support Scheme which targets the provision of support to the hardest hit sectors such as aerospace, aviation, and tourism.
For families that are still coping with the uncertainties that came along as a result of covid-19; an amount of S$900 million Household Support Package which also include a one-off cash payments to the lower and middle income families receiving more. The Minister also talked of measures that are meant to help strengthen social safety nets in support of the vulnerable members of the society including the lower income families and low-wage workers.