Mayumi Soh of Pinsent Masons MPillay, the Singapore legal joint venture between MPillay and Pinsent Masons, said: “It is important that employers review the new measures to better understand how they will be affected and take the necessary action.

The budget (95 page / 880 KB PDF) includes a 500 million Singapore dollar (US$372 million) employment and business support package. Small and medium-sized enterprises (SMEs) hard hit by Covid-19 will receive S$1,000 (US$742) per local employee, up to a maximum of S$10,000 per business. Eligible companies must have an annual operating income of less than S$100 million or employ fewer than 200 employees as of December 31, 2021, among other criteria.

The set covers SMEs in business sectors including food and beverage, retail, performing arts and arts education, tourism, hospitality, convention and exhibition. Operators of sports facilities, cinemas, museums, art galleries, historic sites, indoor playgrounds and other family entertainment centers are also included.

Eligible local sole proprietors, partnerships and street vendors, merchants and coffee shops licensed by the Food Agency of Singapore will receive a one-time payment. These companies do not hire local employees and are therefore not eligible for employee-specific subsidies.

Workers who have lost their jobs or been placed on involuntary leave without pay due to the pandemic will be able to apply for the Covid-19 stimulus grant, which has been extended until the end of the year and will provide up to 700 Singapore dollars per month. for three months. The job growth incentive, which supports the hiring of older and vulnerable workers, will be extended for six months until September, with reduced support rates.

The end of the Temporary Bridging Loan Program (TBLP) and the Enhanced Commercial Loan Program will be extended from April 1 to September 30. The TBLP was launched in March 2020 to provide working capital to businesses during the pandemic, while the Business Finance Program commercial loan meets the financing needs of local businesses. Project loans to the national construction sector through the Enhanced Business Finance Program will also be extended for one year, from April 1 to March 31, 2023.

The government will increase the personal income tax payable by the highest income Singaporean resident taxpayers from 2024. The tax will be charged at 23% on taxable income above S$500,000 up to S$1 million, while income above S$1 million will be taxed at 24%. This is more than the 22% tax currently levied on income over S$320,000. Income above S$320,000 up to S$500,000 will continue to be taxed at 22%.

The government will co-finance 50% of wage increases in 2022 and 2023, 30% of wage increases in 2024 and 2025, and 15% of wage increases in 2026, through a new progressive wage credit program. Finance Minister Lawrence Wong said an initial amount of S$2 billion would be set aside in 2022 to fund the program.

The grants will apply to local workers, including Singaporeans and permanent residents who earn a gross salary of up to S$2,500 per month. There is a lower co-funding rate for those earning above S$2,500 and up to S$3,000, i.e. 30% for salary increases in 2022 and 2023, and 15% for salary increases in 2024. Employers would be required to increase their gross salary by an average of at least S$100 per year to qualify for the support for that year. The Inland Revenue Authority of Singapore will automatically pay the allowance in the first quarter of the year following the salary increases.

The current Work Income Supplement program will also be improved, including higher maximum annual payments from S$2,100 to S$4,200, an increase in the qualifying income ceiling from S$2,300 to S$2,500 and the extension of the program to young workers aged 30 to 34.