New PIC+ scheme for SMEs deserves a standing ovation

THE Singapore economy grew 4.1 per cent in 2013 with an overall surplus of $3.9 billion for FY2013, about 1.1 per cent of GDP. This growth, however, was supported mainly by temporal cyclical factors. In view of this and the uncertain global outlook for 2014, the real GDP forecast range for the Singapore economy for 2014 is 2-4 per cent.

The tax changes announced in Budget 2014 fortify the efforts of businesses in their pursuit of increased productivity, which Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam described as core to quality growth.

The headline business tax change was in the Productivity and Innovation Credit (PIC) scheme, first introduced in the 2010 Budget. The PIC aims to support enterprises' efforts to innovate, gain competitiveness, come up with new products and services, and generate new or additional revenue streams by helping to defray some of the related business costs in six key activities along the innovation value chain.