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How does Singapore Budget 2017 affect you? 2 minute guide
It’s good to know that Finance Minister Heng Swee Keat has recovered from last year’s stroke. He delivered a lean, green Budget speech on Monday February 20th.
There is some good news for families, businesses, students and workers. But water, luxury motorcycles and diesel will all cost more. Here is your 2 minute guide to Singapore Budget 2017.
1. Income tax rebate 2017
Singapore workers will benefit personal income tax rebate of 20 per cent, capped at $500 for YA2017. In total, this rebate will cost the Government $385 million.
2. Pay 30% more for water
As the water supply from Johor and local reservoirs becomes more unpredictable, Singapore will be relying more on costlier water sources - from Newater to desalinisation.
Water tariffs will increase by about 30 per cent by 2018. The increase will be rolled out in two phases - from July 2017, and July 1, 2018.
3. Increased taxes on vehicle emissions
A new emissions scheme for vehicles will be introduced in 2018. It will take into account four pollutants + carbon dioxide.
4. Changes in diesel taxes
These come into immediate effect.
- Volume based tax To encourage users to reduce their diesel consumption. There will be a volume-based tax at $0.10 per litre on automotive diesel, industrial diesel and the diesel component in biodiesel.
- Lump-sum reduction The current lump-sum diesel special tax will be reduced by $100 for diesel cars and $850 for taxis.
5. Pay more for luxury motorcycles
Over half of Singapore’s motorcycle riders will continue to pay the current rate of 15 per cent, details as follows:
- Motorcycles with an open market value (OMV) of up to $5,000 – additional registration fee (ARF) remains at 15 per cent.
- Motorcycles within the next $5,000 - ARF subject to a rate of 50 per cent.
- Motorcycles with OMV beyond $10,000 – ARF subject to a rate of 100 per cent.
6. Some couples enjoy higher grants for resale flats
Married couples looking for resale flats benefit from CPF Housing grant increases from $10,000 to $20,000.
- First-time applicants buying a four-room or smaller flat – CPF grant now $50,000, up from $30,000.
- For five-room flat or bigger – CPF grant now $40,000.
When you add in the Proximity Housing Grant (PHG) and Additional CPF Housing Grant (AHG) - some couples now benefit from up to $110,000 in subsidies.
7. Help for job hunters
The Attach and Train program will help Singaporeans find jobs in new growth sectors by helping workers:
- Raise wage and training support under the Career Support Program, the Professional Conversion Program and the Work Trial Program.
- Find training or internships in industries that have growth potential but where companies may not be ready to hire yet.
8. Help for students and professionals to work internationally
The Global Innovation Alliance will help:
- Singapore university students to get work experience in overseas start-ups.
- Connect Singaporean entrepreneurs and business owners with mentors and investors abroad.
- Facilitate partnerships between local and international firms looking to expand in the region.
It’s not just us…
Finance Minister Heng Swee Keat also announced that ministries would face a permanent 2 per cent cut to their Budget caps. The Government needs to focus on value for money and do "better - and more - with less", Mr Heng said.
We will analyse how the diesel tax may affect you in a future post. As always, we are looking for ways to help you make the most of your money.
Wherever you go, whatever you do, remember it’s vital to have good Travel and Car cover.
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