With the details of the Goods and Services Tax increase (GST), expected to be in Budget 2022 this month, businesses should not experience an abrupt increase in their expenses.
T Chandroo (chairman of the Singapore Indian Chamber of Commerce and Industry) expressed this view in one of his many proposals for Lawrence Wong, Finance Minister of Singapore. Wong will deliver the Budget for this year to Parliament on February 18.
Chandra stated that the GST increase of 2 percentage points could dampen consumer spending in key areas like retail and food and drink (F&B), impacting many small and medium-sized businesses.
He said, “Too much money after too few goods might not bode well to the economy as the supply chain is being restructured worldwide.”
Chandra also suggested that the government mandate companies to pay a portion of their utility bills for employees who work from home.
He said, “This will encourage more workers to work from home (to do it) and help reduce (Covid-19] transmissions in the local community.”
Chandra advised the government not to abandon many of the assistance programs introduced in the recent Budgets, as the pandemic is still raging.
Schemes such as the Jobs Support Scheme or waivers to rental may be needed for an additional nine months. These can be “progressively lifted,” according to Chandra.
He also recommended several tax changes, including a surcharge on income taxes for taxable incomes exceeding S$1million per year and tax holidays to companies that build eldercare facilities.
He suggested that green technology be addressed by a tax reduction of between 2 and 3 years to allow the leasing of an electric car to be deducted. He called on Singapore’s authorities and Malaysia to collaborate to ensure that electric vehicles entering Malaysia are equipped with charging stations.
SICCI calls for greater engagement with the corporate sector in implementing Singapore Green Plan 2030. They want more dialogues to gather views from firms involved in green technology business so that the Green Plan can reach all corners of society.
Chandra noted that workforce shortages are another problem facing businesses today. This can be addressed by reskilling older workers and attracting them back into the workforce. Also, it can speed up the entry of foreign workers from other countries.
He stated that “restaurants in F&B and ancestral trade (flower-making for weddings, funerals) face a labor shortage.” “In these tough economic times, SICCI recommends a relaxation in entry rules for such workers.”
Chandra also suggested that flexible employment programs be developed, such as outsourcing work to Singapore-based businesses that can provide skilled workers for different periods, for example, six months to two years. He said that this could reduce dependence on foreign labor and discourage companies from moving their operations overseas.