E-briefing: Summary of the Solidarity and Resilience Budget Measures

Summary of the Solidarity Budget measures targeted at supporting businesses which was announced on 6 April 2020.

1. Enhanced Jobs Support Scheme (JSS)
   • Government will pay 75% of the first $4,600 of monthly salaries paid in April 2020, for every local worker in employment.
   • From May 2020, wage support levels will revert to original levels in Resilience Budget (25% for non-aviation and tourism sectors).
   • First JSS payout will be brought forward to April 2020.

      

2. Ease Labour Costs for Employers
   • Waiver of monthly Foreign Worker Levy due in April 2020.
   • Foreign Worker Levy Rebate of S$750 in April 2020 from levies paid this year for each work permit or S Pass holder.

      

3. Enhanced Financing Support
   • Increase Government’s risk share of loans from 80% to 90% for loans initiated from 8 April 2020 till 31 March 2021, under the Temporary Bridging Loan Programme and Enterprise Financing Scheme.

      

4. Enhanced Rental Waivers
   • Increase rental waivers from 0.5 month to 1 month for industrial, office and agricultural tenants of Government agencies.

      

5. Ensure Pass-through of Property Tax Rebate announced in Resilience Budget
   • COVID-19 (Temporary Measures) Bill to ensure pass through of up to 100% Property Tax Rebate from property owners to tenants for non-residential properties.

For more details on the Solidarity Budget, please refer to: https://www.singaporebudget.gov.sg/budget_2020/solidarity-budget/solidarity-budget-measures/solidarity-budget-booklet-eng.

Summary of the Resilience Budget measures targeted at supporting businesses which was announced on 26 March 2020.

1. Enhanced Jobs Support Scheme
   • Employers will receive a 25% cash grant (up from 8%) on the gross monthly wages of each local employee on their CPF payroll. The monthly wage cap will also be raised to $4,600 (up from $3,600) per employee to provide greater support for middle income employees. (further enhanced to 75% cash grant for the month of April 2020 in the Solidarity Budget)
   • This scheme will be extended to cover 9 months of wages till end 2020.
   • This will be paid out in three tranches. Employers can expect to receive the first tranche of JSS payment from the Inland Revenue Authority of Singapore (IRAS) by 31 May 2020.

      

2. Enhanced Wage Credit Scheme
   • Additional $500m for employees’ wage increases, on top of $600m disbursed in March 2020.
   • Employers who benefit from additional wage credit arising from the Budget 2020 enhancements will receive a separate supplementary payout in end-June 2020.

      

3. Deferment of Income Tax Payments
   • Automatic deferment of income tax payments for companies for three months, for payments due in April to June 2020. Instead, the payments deferred from April, May, and June 2020 will be collected in July, August, and September 2020 respectively.

      

4. Freeze All Government Fees & Charges
   • All government fees and charges frozen for 1 year, from 1 April 2020 to 31 March 2021.

      

5. Enhanced Property Tax Rebate for 2020
   • 30% rebate for non-residential properties, including offices. (Landlords strongly urged to fully pass on the rebate to tenants, by reducing rentals, to directly ease the cash flow and cost pressures faced by tenants).

      

6. Enhanced Rental Waivers
   • There will be up to 2 months’ rental waiver for commercial and other non-residential tenants in government properties.
   • Government agencies such as JTC, SLA, HDB, URA, BCA, NParks and PA will provide half a month’s worth of rental waiver (increased to one month in the Solidarity budget) to eligible tenants of other non-residential premises who do not pay Property Tax. Eligible tenants/lessees may include those in premises used for offices.

      

7. Enhanced financing support
   • Enhanced Enterprise Financing Scheme -Trade Loan (EFS-TL): Maximum loan quantum of EFS-Trade Loan increases from $5m to $10m and Government’s risk-share raised to 80% (raised to 90% in the Solidarity Budget), from 1 April 2020 until 31 March 2021. Available to enterprises in all industries to help them with their trade financing needs.
   • Temporary Bridging Loan Programme: Programme will be expanded to cover all sectors from 1 April 2020 and maximum supported loan quantum will be raised to $5 million. Eligible enterprises may apply for the TBLP from 1 April 2020 to 31 March 2021.

      

8. SGUnited Traineeships
   • Government will co-fund wage costs of companies offering traineeships to first-time jobseekers, to support up to 8,000 traineeships in 2020 across both large and small enterprises.​​

The following are the Resilience Budget measures pertaining to employees.

1. COVID-19 Support Grant

• Cash grant of $800 a month for 3 months for lower-and-middle-income Singaporeans who lose their jobs due to COVID-19.
• Singapore Citizens or Permanent Residents, aged 16 years and above, who are presently unemployed due to retrenchment or contract termination as a result of COVID-10, and meet all the following conditions are eligible:
  1. Had a monthly household income of not more than $10,000, or per capita household income not more than $3,100 per month prior to unemployment;
  2. Lives in a property with an annual value of not more than $21,000;
  3. Not currently receiving ComCare Short-to-Medium Term Assistance or Comcare Interim Assistance;
  4. Applicant must have been employed as a full time, or part time permanent, or contract staff prior to unemployment.
• Scheme will be open for application from May 2020 to September 2020. Those who need immediate assistance in April 2020 can apply for the Temporary Relief Fund.

1. Enhanced Workfare Special Payment

• All Singaporean employees and self-employed persons who received Workfare Income Supplement (WIS) payments in Work Year 2019 will receive a $3,000 Workfare Special Payment (WSP) in 2020.

1. SGUnited Jobs

• Government initiate to create 10,000 jobs over the next year to help jobseekers.

For more details on the Resilience Budget, please refer to: https://www.singaporebudget.gov.sg/budget_2020/resilience-budget/supplementary-budget-measures/supplementary-budget-booklet-eng.

Summary of the Stabilisation and Support Package measures targeted at supporting businesses which was announced on 18 February 2020.

1. Job Support Scheme (JSS)

• Employers will receive an 8% cash grant on the gross monthly wages of each local employee (applicable to Singapore Citizens and Permanent Residents only) for the months of October 2019 to December 2019, subject to a monthly wage cap of $3,600 per employee.
• Employers do not need to apply for the JSS. The grant will be computed based on CPF contribution data. Employers can expect to receive the JSS payment from the Inland Revenue Authority of Singapore (IRAS) by 31 July 2020.
• Please see updated Job Support Scheme in Solidarity and Resilience Budget above.

1. Enhancement to Wage Credit Scheme

• There will be a higher percentage of co-funding.
• Employers need not apply for this, employers will receive payouts automatically in the month of March after the qualifying year (Y+1), for qualifying wage increases given to their employees in the qualifying year (Y).
• Employers who benefit from additional wage credit arising from the Budget 2020 enhancements will receive a separate supplementary payout in the second half of 2020.
• Please see updated Wage Credit Scheme in Solidarity and Resilience Budget above.

1. Corporate Income Tax (CIT) Rebate

• CIT Rebate of 25% of tax payable, capped at $15,000 per company, will be granted for Year of Assessment (YA) 2020.

1. Enhancements of Tax Treatments under the Corporate Tax System

• Please refer to the website linked for details.

For more details on the Stabilisation and Support Package, please refer to https://www.singaporebudget.gov.sg/budget_2020/budget-measures/stabilisation-and-support-package

Should you have any queries, please contact:

Toh Wei Yi

Partner, Eversheds Harry Elias

weiyitoh@eversheds-harryelias.com

+65 6361 9348

Jaclyn Leong

Senior Associate, Eversheds Harry Elias

jaclynleong@eversheds-harryelias.com

+65 6361 9806