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Budget 2016 at a glance

Thursday, March 24, 2016 - 05:00
Finance Minister Heng Swee Keat sought to set the stage for Singapore's next stage in his inaugural Budget statement, aiming the key initiatives at spurring innovation across the business ecosystem.

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The biggest thrust is a S$4.5 billion Industry Transformation Programme that includes plans for a new Innovation District in Jurong. Although the overall economic development allocation is lower by 3.5 per cent, the allocation for trade and industry will increase by 14 per cent to S$3.9 billion.

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The Budget also recognises that an economic slowdown has hit certain segments harder than others, and is offering some short-term relief. Among the various relief measures is an increase of the existing Corporate Income Tax Rebate to 50 per cent from 30 per cent of tax payable for years of assessment 2016 and 2017, capped at S$20,000 per year. Corporate income tax collection in fiscal 2016 is expected to decline by 3.1 per cent to S$13.4 billion.

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Existing programmes such as the Wage Credit Scheme and the Special Employment Credit Fund will also receive additional funding in the coming year. In total, special transfers to businesses will be S$2.2 billion, or about one-third of the total allocation for special transfers.

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The expansionary budget is possible partly because the government is now able to draw on a larger proportion of the returns generated by the investments of Temasek Holdings, a Singapore government-owned investment company. Net investment returns contribution is projected to be S$14.7 billion in the coming year, displacing corporate income tax as the largest contributor to government coffers for the first time.

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Flow of Money (S$b)

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