Find out more at btsub.sg/promo
You are here
PwC urges SME boosts, innovation in 2015 budget
FORGET Santa Claus and Christmas. It is only Dec 1, and PwC already has its wishlist ready - for the 2015 Singapore budget.
Measures to reduce the burdens of small and medium enterprises (SMEs), ease the risk of investing in intellectual property and lessen the strain on the old will help Singapore to lay the foundation for the next 50 years, the accounting and consulting firm said.
"Singapore has to increase productivity. Singapore has to prepare for an ageing population and there are increasing social needs. Singapore has to enhance international competitiveness but yet be mindful of international scrutiny," PwC Singapore tax leader Chris Woo said in a statement.
PwC is urging extra goodies for SMEs. Small companies that voluntarily re-employ older workers should enjoy extra deductions; the current partial tax exemption for SMEs should become a full exemption for the first S$300,000 of income; and lenders to SMEs should enjoy double deductions for loan losses, PwC said.
Innovation can be encouraged by exempting gains on disposal of intellectual property from taxation. Personal tax relief should also be provided for employees who work from home. Losses from loans that use intellectual property as collateral could also enjoy more deductions, it said. There should also be more incentives for overseas training and hiring foreign talent.
Beyond encouraging employment for older workers, PwC is also advocating more support for alternative pension schemes and increasing caps on employers' deductions for medical benefits.
It is also urging the government to extend or remove time limits on incentives for gains from disposals of equity investments; expand the mergers and acquisitions scheme to non-Singapore incorporated or headquartered parents; and streamline and sweeten tax incentives for real estate investment trusts, asset management and offshore insurance businesses. The firm argued that these measures can improve the competitiveness of the Singapore financial markets.
From an administrative perspective, PwC also urged the government to remove a quirk that gives different companies different lengths of time to file their tax returns depending on their financial year ends. Companies currently have until Nov 30 of the year following their financial close to file their tax returns regardless of their financial year ends.
"In the case of a company with, say a March year end, there is a time lag of 20 months between the financial year end and the tax return filing deadline," PwC explained. "The government should consider introducing staggered filing deadlines (for example within 12 months after the financial year ends). This should facilitate more timely assessment and collection of taxes by the Inland Revenue Authority of Singapore and the finalisation of tax matters for taxpayers who benefit from certainty of their tax positions."
The Singapore government usually announces its proposed budget for the year ahead by mid-February.