It’s that time of the year again, when the government provides an announcement on the Singapore Budget.
Just like how you would plan your family finances for the year, the Singapore government shares their financial plans for Singapore as a country through the Budget.
This year’s Singapore Budget 2020 will take place on Tuesday, 18 February 2020. For those keen to find out how Singapore’s finances are budgeted and managed, here’s an overview of the Singapore Budget.
With this year’s Budget just a week away, here’s a quick recap of the key announcements shared during Singapore Budget 2019.
Singapore Budget 2019 Summary
1. Ang baos were handed out
In 2019, Singapore celebrated its bicentennial. Singapore citizens aged 21 and above received a bicentennial GST Voucher payment of $150 to $300.
Lower-income workers also received an additional 10% of their workfare income supplement payment as part of the Workfare Bicentennial Bonus, with a minimum payout of $100. Middle-income earners enjoyed 50% in personal income tax rebates for YA2019, capped at $200.
Singaporeans aged 50 to 64 with less than $60,000 in their CPF accounts also received a one-time CPF top-up of up to $1,000. For the young, all primary and secondary school children received a $150 top-up to their Edusave accounts. Tertiary students between 17 and 20 also received a top-up of up to $500 in their Post-Secondary Education Accounts (PSEA).
2. Tighter restrictions on alcohol purchased from duty free
With the changes to alcohol restrictions made during last year’s Budget, the amount you can purchase with each passport when you return from your overseas trip has been reduced.
The biggest change was that instead of 3 litres, you will only be able to buy 2 litres of duty-free alcohol when you come back from your overseas trip.
If you spend less than 48 hours outside Singapore, you will have to pay GST on goods bought overseas as long as they are worth more than $100. Previously, you only had to pay GST if the goods bought were worth more than $150. If you spend 48 hours or more outside of Singapore, the relief was reduced from $600 to $500.
3. GST confirmed to increase to 9%
In Budget 2019, the proposed increase in GST to 9% was all but confirmed. With the GST increase slated to be between 2021 and 2025, more information on the exact timing of the planned GST hike could be shared in Budget 2020. The government will also be rolling out a GST support package, with more details released in Budget 2020.
4. CHAS subsidies were enhanced
The Community Health Assist Scheme (CHAS) enables all Singapore citizens, that are CHAS Blue or Orange, Merdeka Generation and Pioneer Generation cardholders to receive subsidies for medical and/or dental care at participating General Practitioners (GPs) and dental clinics.
In 2019, CHAS coverage was extended to cover all Singaporeans with chronic conditions, regardless of income. Lower to middle-income Singaporeans who are CHAS Orange cardholders, also had their subsidies extended to include common illnesses. Previously, only CHAS Blue and Pioneer Generation cardholders received these subsidies. CHAS subsidies for complex chronic conditions were also increased.
5. Merdeka Generation receiving benefits from the Merdeka Generation Package
More support has been provided to the seniors in our society, in particular, the Merdeka Generation. The Merdeka Generation refers to those born between 1950 to 1959, accounting for about 500,000 of Singaporeans. Before the Merdeka Generation Package, the Pioneer Generation Package was introduced in 2014 for the Pioneer Generation (those born on or before 31 December 1949).
As part of the Merdeka Generation Package, the Merdeka Generation will receive:
- A Medisave top up of $200 a year for 5 years (from 2019 to 2023)
- One-time top-up of $100 to the PAssion Silver Card
- More subsidies at CHAS clinics, polyclinics, and public Specialist Outpatient Clinics (SOCs)
- Additional subsidies for MediShield Life
- $1,500 incentive to join CareShield Life when it becomes available in 2021 (on top of the previous $2,500 announced, bringing the incentives to a total of $4,000)
In June 2019, eligible Merdeka Generation seniors would have received their Merdeka Generation Card and a welcome folder which contains more details on the benefits.
What To Expect For Budget 2020
The Budget is done with the Singaporeans at heart and it is also meant to be a two-way conversation. To get feedback and suggestions before the Budget, more than 10,000 responses were collected by government feedback unit Reach, the People's Association (PA) and the Finance Ministry.
Here’s what we know so far, and what to expect of the Singapore Budget 2020.
1. Supporting families
More support will be provided to families to cope with the cost of living and caregiving needs. To cushion the impact and help Singaporeans with the transition from paying 7% GST to 9% GST, a GST support package will also be released, with the details to be shared in this year’s Budget. The GST Voucher scheme will also be enhanced.
2. Helping businesses tide through difficult times
With the economic repercussions that stem from the Wuhan Coronavirus (also known as 2019-nCoV), it has been shared that Budget 2020 will have measures put in place to help businesses and Singaporeans tide over this difficult period. This includes adjustments made to make sure companies and workers are supported.
Deputy Prime Minister Heng Swee Keat said that a relief package is in the works, to help the transport and tourism sectors hardest hit by the epidemic. Similarly, during the Sars period in 2003, a response package was introduced to help hotels and the tourism sector.
3. Support for those in their golden years
WIth the aim for seniors in Singapore to lead fulfilling lives at every stage of life, there will be initiatives to promote volunteerism and help seniors with their retirement needs. Companies will also have incentives to employ older workers, as well as to give them flexible working hours.
4. Climate change and sustainability
Climate change will also be something that will be addressed in Budget 2020. This does not come as a surprise, especially with natural disasters happening around the world due to climate change. One just needs to look at the Australian bushfires to see the far-reaching effects this could have on wildlife, environment, people, economy and the country in general.
Read these next:
5 Highlights You Must Know About Singapore Budget 2019
GST 2020 Changes: How Does It Affect You?
The Ultimate Financial Checklist For 2020
10 Financial Resolutions To Make This 2020
5 Benefits You Are Missing Out On If You Haven’t Claimed Your Merdeka Generation Package