7 measures analysts are expecting from Budget 2023

UOB expects the budget to focus on navigating Singapore through an uncertain year.

Singapore’s 2023 budget will likely include seven measures that will help Singapore navigate through an uncertain year, according to analyst UOB.

Amongst these measures include short-term support measures for services industries relating to manpower. UOB said there would likely be “a temporary increase of the dependency ratio ceiling (DRC), and more incentives to attract locals to these industries.”

Another change that UOB expects to see in the budget is further enhancement to the Assurance Package to between $500m and $1b.

UOB believes the government will also address the significant knowledge gap on sustainability between large companies and small companies with much fewer resources and access to sustainability-related financing.

In relation to sustainability, the analyst said the government might also explore co-sharing lending risks for loans taken for green projects or green transition projects.

Another important measure that UOB expects from the budget is further clarification on the Base Erosion and Profit Shifting (BEPS) 2.0 Project and top-up tax that is the Minimum Effective Tax Rate, or “METR,” for Singapore’s corporate tax system, which will have far-reaching consequences for Singapore’s biggest tax revenue component.

Non-business matters that the government will likely tackle in the budget are moves to boost the fertility rate and the possible cessation of COVID help measures.