Singapore: Deputy Prime Minister Lawrence Wong noted in his budget speech the challenges Singapore has to face, including inflationary pressures.
Mr. Wong’s Finance Minister said in a Parliament on Tuesday that, though there are signs that inflation rates are softening, the Government expects inflation to be high for at least the first half of the year in Singapore.
Hence the Government moved some targeted measures at the softening effects of inflation on the cost of living.
7 Things To Know About This Year’s Budget Speech
1. Protecting the effects of inflation
The Government will provide a pamphlet on “cost of living special payment ” to all eligible Singaporeans who are 21 and above, have an annual income less than S$100,000, and do not own a property.
The payments range from S$ 200 to S$400, depending on how much income an individual earns, and hence will allocate the price in June to almost 2.5 million adult Singaporeans.
In January 2024, all Singaporean households will get vouchers for S$300 from the Community Development Council (CDC).
2. Helping families achieve housing aspirations
Housing grants will be provided to families without housing subsidies before buying resale flats. Budgets will increase to S$30,000 based on the size of the apartments.
The Government will also adjust its Build to order (BTO) to help specific groups like families with children and young married couples aged 40 and below who wish to buy their first home.
3. More support for parents
The Baby Bonus Cash Gift will be provided up to S$3,000 for Singaporean children born from Tuesday. The Child Development Account (CDA) will increase from S$ 3,000 to S$5,000. The Government will also increase its co-matching cap by S$1,000 for the first and second child.
Besides, the Government paid paternity leave will be doubled from two to four weeks for fathers if Singaporean children are born from Jan 1, 2024.
The Working Mother Child Relief will also be changed from a percentage of the mother’s income to providing a fixed sum.
4. Central Provident Fund (CPF) monthly salary ceiling to be raised.
This year from September, the CPF monthly salary ceiling will be increased from S$6,000 to S$8,000 till 2026.
From September 2023, the CPF monthly salary ceiling will be increased from S$300 to S$6,300.
From January 2024, it will rise to S$6,800; in 2025, it will increase to S$7,400 and S$8,000 till January 2026.
5. Higher marginal Buyer’s Stamp Duty for higher-value properties
In the case of residential properties, the portion of the property’s value over S$1.5 million and up to S$ 3 million will be taxed at 5 percent. More than S$3 million will be taxed at 6 percent, up from the current rate of 4 percent. The changes are likely to affect 15 percent of the residential properties.
Besides, for residential properties, the value of the property over S$1 million and up to S$1.5 million will be placed at 4 percent, whereas in case of excess of S$1.5 million, will be taxed at 5 percent, which is up from the current rate of 3 percent. These changes are likely to affect 60 percent of non-residential properties.
The Buyer’s Stamp Duty changes will apply to all properties from Wednesday.
6. Higher Additional Registration Fee (ARF) for cars.
The rates of ARF will be adjusted to differentiate between the higher-end cars and tax luxury cars at a higher rate.
The Preferential ARF rebates will be limited to S$ 60,000 to avoid excessive repayments to more expensive cars whenever they are deregistered.
Besides, the changes are likely to affect the top one-third of cars by OMV. Additionally, buyers of cars with an OMV of S$40,000 or less will not be affected.
7. Higher tobacco tax
There will be a 15 percent increase in the excise duty on tobacco which will come into effect from Tuesday for all tobacco products. The increase is anticipated to generate about S$100 million in additional expenses annually.
Conclusion
The report mentioned above stresses the much-anticipated budget of Singapore, which clarifies the cost of living cash payout, stamp duty, and many other necessary modifications that will likely benefit Singaporeans.
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