Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam delivered the Budget statement 2015 "Building our Future, Strengthening Social Security" at 3.30pm in Parliament.
The Budget is expected to record a deficit of $0.1 billion for FY2014, smaller than estimated $1.2 billion mainly due to increase in motor-related revenues.
Budget 2015 is focused on building Singapore’s future. It takes major steps in four areas (see graphic from Ministry of Finance below):
Here are 8 key points of DPM's Budget Statement:
1. What is SkillsFuture? It will help Singaporeans with their lifelong learning, through internship programmes, education credits and career guidance.
i) SkillsFuture Credits: All Singaporeans aged 25 and above will receive an initial credit of $500 for work skills-related courses from 2016. There will be an online resource for a one-stop education, training and career guidance.
Beyond the SkillsFuture Credit, the Government will support Singaporeans seeking to develop skills in particular fields through the three initiatives: SkillsFuture Study Awards, SkillsFuture Fellowships and the SkillsFuture Leadership Development Initiative.
2. Continuing the restructuring of Singapore's economy:
i) The Transition Support Package (TSP): To give businesses more time to adjust to rising costs as they restructure, with TSP being phased out gradually.
It has three parts: the Wage Credit Scheme (WCS), Corporate Income Tax (CIT) Rebate, and the Productivity and Innovation Credit Bonus (PIC Bonus).
ii) Managing foreign workforce growth: The Government will defer this year’s round of announced levy increases for every sector, for S Pass and Work Permit Holders. Foreign workforce growth, excluding Construction, has slowed significantly from 60,000 in 2011 to just over 16,000 in 2014. In construction, foreign worker growth in 2014 was around 10,000, far below that recorded in the previous two years.
3. Assurance in retirement: There are two sets of measures to strengthen savings and income in retirement - enhancements to the CPF system and the introduction of the Silver Support Scheme (SSS).
i) Enhancements to CPF system: i) Increase CPF Salary ceiling to $6,000 from 2016; ii) Raise CPF Contribution Rates for older workers; and iii) Extra CPF interest for all CPF members 55 & above.
ii) Silver Support Scheme (see below)
4. Help for Education: i) Account top-ups for young S'poreans; ii) Full fee wavier for exams (PSLE, 'N', 'O' & 'A' level exams, poly and ITE exams; and iii) Support for Needy students - additional $6 million grant to self-help groups
5. Help for Households: i) Foreign Domestic Worker Concessionary Levy reduced to $60 per month; ii) GST Vouchers; and iii) One-off rebate for Service & Conservancy Charges.
6. Foster a spirit of giving: i) Government will donate $20,000 to each school to use for the causes that they identify. This initiative will be extended to Polytechnics and ITE, for which the Government will donate $150,000 and $250,000 respectively; and ii) Government will increase tax deduction rate to 300% for 2015 for donations.
7. Vehicle-related taxes: i) Increase in Petrol Duty rates by $0.15/$0.20 per litre from 23 Feb 2015; and ii) One-year Road Tax rebate
8. Personal Income Tax (PIT): i) Increase top marginal tax rate from 20% to 22% for chargeable income above $320,000 and ii) Increase marginal tax rates for chargeable incomes above $160,000 to $320,000 by 1 to 2%.
To know more about this year's Budget, click here.
Top photo screenshot from here.