, Singapore

Singapore Budget 2020 Full Coverage: COVID-hit sectors to get $4b and GST hike moved to 2025

The budget deficit could hit $5.1b in 2020, the government injects $1.6b into the CPF Housing Grant, and $1b gets pumped into cybersecurity measures.


  • Our Singapore Fund (OSF)
    • Nearly $4.3m has been committed to support ground-up projects for culture, heritage, arts, and sports
    • $250m to be set aside for greater movement to partnership efforts
    • Extend OSF beyond 2020 to support more ground-up initiatives
  • Issued National Innovation Challenges to date
    • AI-enabled healthcare, ageing, energy, urban mobility, etc.
  • Government to address more specific challenges to encourage ground-up participation
    • Challenges in the social sector to support youth mental wellbeing amongst other things.


  • Ongoing discussion to revise international tax rules under the Base Erosion and Profit Shifting (BEPS) project
  • Singapore is one of the countries with triple AAA credit rating
  • The government will set aside an Assurance Package for GST
    • Today, the net investment return contributions from our reserve is the biggest component of our revenue."
  • Singapore budget deficit
    • For FY2019, Singapore government expects an overall budget deficit of $1.7b, or 0.3% of GDP.
      • This deficit is $1.8b lower than the $3.5b deficit forecasted a year ago
    • For 2020: "We expect a basic deficit of $5.1b or 1% of the GDP"


  • "Diplomacy and deterrence are the twin pillars of SG sovereignty."
  • SGSecure Movement
  • Cybersecurity Agency (CSA) (2015) and passing of Cybersecurity Act in 2018
  • CSA preparing more measures for the next-level of cybersecurity
  • The government will set aside $1b over the next three years to build up country’s cybersecurity and data security capabilities


  • Manage greenhouse gas emissions
    • Carbon tax introduced in 2019
    • Enhanced minimal energy performance tenders
    • Domestic transport sector: Significant carbon gas emissions
  • Progressively phase out the use of internal combustion (ICE) vehicles
    • Set a long-term strategy goal to achieve this
    • All vehicles must have cleaner energy by 2040
  • 3 measures for ICE vehicles phase-out:
    • 1. Enhance incentive to encourage adoption of cleaner vehicles
      • Commercial Vehicle Emissions Scheme
        • For light vehicles, announce details at COS
      • Cars and taxis: Additional EV Early Adoption Incentive
        • Those who purchase EV will receive rebates of up to 45%
        • Fully electric car: Rebate of up to 45% on the Add’l registration fee capped at $20,000
        • From January 2021: Across the board reduction for road tax for EVs and hybrids
    • 2. Revise road tax methodology for cars
      • Extend public charging infrastructure for EVs
      • Expand EV charging infrastructure: About 1,600 currently
      • By 2030: Up to 28,000 chargers at public chargers islandwide
    • 3. Procure cleaner vehicles
      • Mileage tax: To discourage excessive driving and reduce road congestion
      • Update vehicular tax structure to preserve such considerations
      • Usage-based tax on EVs as an alternative to fewer excise duties
      • In the interim, a lump sum tax will be imposed to be built in road tax schedule of EVs to partly account for loss of fuel excise duties
        • Phase in starting Jan 2021 for over 30 years
        • Full quantum implemented by Jan 2023
        • EV buyers can expect to enjoy substantial cost savings
  • Energy efficiency measures
    • Households encouraged to purchase energy-efficient household appliances
    • Incentives to help lower income household with the cost of this appliances
  • Newer housing developments will have 45-60% green cover
  • More than 36,000 gardening enthusiasts are nurturing over 1,500 community gardens island-wide
  • New HDB Green Towns Programme
    • Key focus areas: reduce energy consumption, recycle rainwater, cool HDB homes/towns
  • Combatting rising sea levels
    • Elaborate plans at the Committee of Supply Debate (COS)
    • Climate change adaptation may cause $100b or more over 100 years
    • Coastal and flood protection fund, with an initial injection of $5b, will be topped-up subsequently.


  • Will replace Special Employment Credit (SEC) and Additional Special Employment credit (ASEC)
  • Available from 2021 to 2025
  • Cost of $31m/year
  • The government will review the EEC after two years and make necessary adjustments
  • Top up 3 funds that provide competent help for the elderly and lower income
    • $750m for Elder Care fund
    • $500m for the ComCare fund
    • $200m to the MediFund

Ministry of Social Family Development and National Council of Social Service will develop the Community Capability Trust 

  • Enhance capabilities and capacities of Social Service Agencies
  • $200m provided to the trust in FY2020
  • $150m matching
  • Commit $350m in the community capability trust in the next 10 years


  • 650 active ageing programmes to engage seniors
  • Household income per capita, risen 4.1% per year in nominal terms
  • Basic Retirement Sum (BRS) increase: $90,500 for cohort turning 55 this year
  • Continue adjusting the BRS for the same 3% every year; $93,000 for cohorts turning 55 in 2021; $96,000 in 2022
  • Seven in 10 actively employed persons from these two cohorts expected to be able to set aside their BRS
  • Enhancing the Silver housing bonus and lease buyback scheme
    • Provide risk free interest rates on their savings
    • In 2019, such voluntary cash top-ups added up to about $1b
  • For those with less CPF
    • Matched retirement saving scheme from 2021-2025
    • For eligible Singaporeans aged 55-70
    • Not set aside their BRS
    • The government will match every dollar of cash top up to an annual cap of $600
    • About 435,000 Singaporeans will be eligible
  • Silver Support Scheme
    • Silver support currency: Bottom 20% of Singaporeans aged 65 and above
    • Raise quarterly cash payout by 20%
    • Smaller flats: From $750 to $900 per quarter
    • Broader eligibility criteria and new payout tier to cover those $1,300 but not exceeding $1,800


  • In 2019:
    • First-time flat buyers, up to $160,000 in housing grants
    • Income ceilings for subsidised flats and executive condo were raised to $14,000 and $16,000
    • Expect around 16,000 HDB households to benefit each year
  • For 2020:
    • Government will provide comprehensive care and support package amounting to $1.6b
    • One-off cash payout of $300, $200 or $100, depending on income for Singaporeans aged 21 and above
    • Double rebates to a one-off GST voucher, U-Save special payment to all eligible HDB households
    • Extend a service and conservancy rebate by another year, receive rebates between 1 ½ and 3 ½ months of S&CC charges
  • Lower-income Singaporeans will receive:
    • Grocery vouchers worth $100 each year in 2020 and 2021 for use in major supermarkets
    • A further $100 cash payout with at least one Singaporean child aged 20 and below
    • Additional GST voucher for larger households with five or more members
    • Larger household can receive 2.5 times more than the regular rebates this year and receive up to $1,000
  • $100 top-up to the Passion Card to all Singaporeans aged 50 above this year
    • Those who don’t have card can receive one for free
  • For self-help groups: Provide $10m grant over two years to help more families
    • Community development councils
    • Each CDC has a set of local assistance schemes
    • Provide $20m to CDCs (Community Dev’t Councils) to do more
  • Care and support package for families will be at $1,300
    • A three-generation family can receive above $1,800


  • Enhanced preschool subsidies will be made available to more families this year
  • Increased government support to preschool places: From 50% today to 80% by 2025
  • Doubling support for young and preschool years
    • 2018: spent about $1b on early childhood sector
    • Within next two years, will double to over $2b per year
  • Secondary school
    • Lower income families: Enhance the MOE financial assistance scheme
    • Pre-university system: From $900 to $1,000
  • Bursary for full-time ITE students for AY 2020
    • Lower income tier: 100% fee subsidies on top of the cash bursary
    • Lower and middle income: Cash bursary quantum increased by $200/year
    • Cost of bursaries for higher education will rise from $148m/year to $198m/year
  • A Singaporean child will receive $180,000 in total by the time he turns 16
    • This includes $50,000 in government subsidies over 5 years
  • SOCI2010-2019: Healthcare expenditure tripled from $4b to $12b per year
  • Education: From $10b to about $13b
  • National developments: From $2.4b to $3.6b with the bulk going to subsidies in public housing
  • Gave out $1.1b dollars in cash to Singaporeans who need more help


  • Concerns on S-Passes
    • Holders from construction, manufacturing, marine shipyard sectors growing by 3.8% per year over the last 2 years
    • Can increase over the next 2 years as sector recovers
    • "S-passes should not be a means for firms to hire low-cost foreign workers when qualified locals are available."
  • Cuts for dependency ratio ceilings for the services sector
    • Starting 1 January 2020, the DRC for the services sector will be reduced to 38% from 40%, and cut further to 35% from 1 January 2021
  • For 2020
    • Reduce S-Pass sub-DRCs in construction, marine, shipyard sectors from 20% to 15% from 1 January 2021 to 1 January 2023
    • Tighten S-Pass sub-DRCs for manufacturing sector as well
  • Lean Enterprise Development Scheme
    • Maintain foreign worker levy rates for 2020 (2019 data: $300 for higher-skilled workers and $450 for basic-skilled workers)


  • Raised CPF contribution for those 55-70 years old
  • To ease these changes: Senior Support Package is introduced comprising four measures:
    • Senior employment credit, take effect by 2021
    • When employer CPF contribution rates go up: we will provide employer with CPF offset by half of contribution
    • Senior worker early adapter grant
    • Part-time reemployment grant
  • Wage offsets in employing Singaporean workers 55 and above


  • Some workers in 40s and 50s have not changed jobs since leaving school or upskilled
  • Now facing greater competition from younger workers and overseas
  • Broader global shifts: Exciting jobs will emerge
  • New Skills Future MidCareer Support Package
    • Locals in 40s and 50s
    • To help them stay employable, move on to new jobs
    • Double annual local job placement to around 5,500 by year 2025
  • Reskilling programmes
  • For each eligible worker: Provide 20% salary support to employer for 6 months, $6,000 in total
    • Improve access to reskilling programme
    • $500 dollars special SkillsFuture credit for Singaporeans in 2020
    • Credit will expire in five years to encourage early action


1) Introduce a SkillsFuture Enterprise Credit - Embark in the transformation of workforce

  • 90% of out-of-pocket costs of business transformation, job redesign and skills training
  • $10,000 per enterprise
  • Benefit 35,000 enterprises, most of which are SMEs

2) Productivity solutions grant

  • More support for job redesign services
  • o Pre-approved digital solutions and equipment
  • o Job redesign consultancy services

3) Work with large anchor enterprisers

  • Help the skills of workers in SMEs
  • Aims to partner up to 40 of such anchor enterprises to benefit 4,000 SMEs in the next 5 years

4) Institutes of Higher Learning (IHLs) work with more enterprises through SkillsFuture Work-Study Programme

  • Double capacity by 2026
  • Make this the mainstream pathway, with 12% of each cohort going through these pathways, up from 3.5% today

5) Working with Nanyang Polytechnic National Centre of Excellence

  • Deepen workplace learning capabilities

One-off SkillsFuture credit top-up is proposed

  • $500 for every Singaporean aged 25 years and above
  • Starts from 1 October 2020
  • Will expire in five years, ending in 2025

SkillsFuture Movement

  • 5 years after launch: Training participate rates rose to 49% in 2019 from 35% in 2015
  • End-2019: Helped more than half a million Singaporean pick up new skills and develop new developments
  • Three elements to further support SkillsFuture
    • Enabling the individual
    • Enhancing the role of enterprises in developing their staff
    • Special focus on mid-career workers


  • Study trips
  • Set ourselves 70% of local IHL graduates to have overseas experience
    • 70% of this group to have exposure to ASEAN, China, India
  • New Asia-ready Exposure Programme
  • Internships: Global Ready Talent Programme

Enterprise Transformation Package

  • Launch Enterprise for the Leadership Transformation Programme for Promising SMEs
  • Over next 3 years: Support leaders of 900 enterprises
  • Collaboration between banks and institutes for higher learning
  • Continue to broaden transformation to the Enterprise Development Grant in FY2020
    • Support about 3,000 projects through the EGD in FY2020
    • This will increase by 10%

Beyond Startups

  • SMEs Go Digital programme
    • Gold business platform: Single touch point for enterprises to transact with the government digitally
    • Expand to all 23 ITM sectors
    • Access to pre-approved digital solutions
  • Markets Readiness Assistance Grant
  • Enhance market readiness assistance grants
  • Expanding support package (FTA consultancy)

Startups Ecosystem

  • 3,800 tech startups in Singapore
  • 150 VC funds investing in startups here and in the region
  • Ranked in the top 15 globally
  • StartupSG helps startups get their ideas off the ground
    • Holistic support through: Co-investments, Mentorship, Fiscal space
  • Startup SG equity
    • Catalysed $560m in private sector funding over the past 4 years
    • Improve support for deep tech startups (including advanced manufacturing, agritech)
    • $300m will be set aside under the startup SG equity
    • More equity over the next ten years

Enhance for Trade Associations and Chambers (TACs) to scale and raise capability of industry

  • Enterprise SG will launch a pilot Executive in Residence programme
    • Fund more than 10 TACs of all sectors
    • Provide expert advice
  • Heartland Enterprise Upgrading Programme to support heartland enterprises

Research Innovation and Enterprise 2020 Plan

  • AI, industrial robotics, urban solutions and sustainability, health and biomedical sciences
  • Enhance solutions and sustainability
  • Number of biomedical startups doubled from 2014: More than 300 startups now

Enhancing digital connectivity

  • Singapore customs connecting with the global trade network platform
  • Last month concluded the first digital economy agreement with Chile and NZ
  • Enable more trade

Set of measures to drive transformation

  • The government will allot $8.3b over the next three years to enable transformation and growth


1) Grow our economy, Transform enterprises, Create opportunities

  • To account for half of global GDP by 2040
  • Productivity rose by 2.6% per year; an improvement over the 2.2% growth in the preceding 3-year period
  • 2016-2019: real median income grew by 3.7% per year, up from 3.2% per from the preceding 3 years

2) Care for Singaporeans in every stage of their lives, creating inclusive society

3) Build a liveable and sustainable SG in the face of climate change, ensure fiscal sustainability

4) Mobilise Singaporeans to work together for this goal


  • Won’t take effect in 2022 but will "not put off increase indefinitely"
  • Provide assurance package when GST rate is raised
    • $6b package for Singaporeans to cushion the increase
  • Majority of Singaporean households to receive offset to cover at least 5 years' worth of additional GST expenses incurred
  • Lower income households will receive much more
    • 1-3 room HDB flats: Equivalent to 10 years' worth of additional GST expenses incurred
    • Every adult Singaporean: Cash payout of $700-$1,600 over five years
    • 4-room HDB flat: Will receive about $7,000 in offset over five years in total, cash about $4,000
  • Fully offset the GST for the lower half of retiree households
  • Significantly offset the upper half of retiree households
  • Budget will set aside $6b for the assurance package in the GSTV Fund in this year’s package


  • The government will set aside $800m to help soften the impact of COVID-19, in which a bulk will go to the Ministry of Health
  • To reduce pressure on corporations, the government will provide $4b of stabilisation and support packages
  • To help SG households and families, the government will provide $1.6b of care and support packages
  • Extend reskilling drom 3 months to 6 months
  • Job support scheme: Retain and train 330,000 local workers
  • Tourism
    • Tourism: Tax rebate of 30% for 2020 for conventions, exhibition venues, etc.
    • Ferry terminal: 15% property tax rebate
    • Integrated resorts: 10% property tax rebate
  • Aviation
    • Rebates of aircraft lending
    • Assistance to ground agents
    • Assistance to shops
    • 15% property tax rebate for Changi Airport
  • Food Services and Retail
    • Full-month rental waiver to any stallholders in NEA hawkers and markets
    • HDB provide half month rental waiver to its commercial tenants
    • Grant 15% property tax rebate for qualifying commercial properties
    • Encourage reduce rents
  • Ministry of Transport's point-to-point support package
    • Taxi and car operators have come out strongly support by matching government contribution

Enhance the enterprise financing schemes

  • Raised from $300,000 to 600,000
  • Government's risk-share on the loans raised to 80% from 50-70%


  • Raised to $5,000 ceiling from $4,000 for qualifying wage increases given in 2019-2020
  • Government co-funding levels for 2019 and 2020 raised by 5 percentage points to 20% and 15%
  • $1.1b to go to about 90,000 enterprises to benefit more than 700,000 Singaporean employees
  • Stabilisation and support package to provide economy-wide support to help enterprises with cashflow
  • Income tax rebate at 25% of tax payable capped at $15,000 per company (costs about $400m)

Two stabilisation and support packages for workers worth $5.6b

  • Stabilisation and support package: $4b dollars
  • Introduce job support scheme
  • Help enterprisers maintain local workers
  • Offset 8% of wages
  • Will be given by the end of July

GDP GREW 0.7% IN 2019

  • Weakest since 2008 financial crisis
  • Arrivals and air traffic in Changi declined, along with hotel occupancy rates
  • We must be prepared that economy impact may be worse than we projected 
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