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Budget 2020: Corporates to enjoy 25% income tax rebate, enhanced tax treatments
The government will grant a corporate income tax rebate at a rate of 25 per cent of tax payable with a cap of S$15,000 for the year of assessement (YA) 2020, alongside an enhancement of several tax treatments for one year, Deputy Prime Minister and Finance Minister Heng Swee Keat said.
In his Budget speech on Tuesday, Mr Heng said the rebate will benefit all tax-paying companies and cost the government about S$400 million.
Enhancements to tax treatments will include allowing enterprises a faster write-down of their investments in plant and machinery, and renovation and refurbishment, incurred for YA 2021. This will put more cash in the hands of these companies.
"For example, hotels can now take advantage of this lull period to carry out upgrading work, and be better prepared for the rebound," Mr Heng said in Parliament.
These tax-related initiatives are part of a S$4 billion Stabilisation and Support Package to support enterprises as they deal with the Covid-19 outbreak.
As part of this package, the Enterprise Financing Scheme's Working Capital Loan component will also be enhanced for one more year to help companies access working capital more easily.
The maximum loan quantum will be raised to S$600,000, up from S$300,000. The government's risk-share on these loans will be raised to 80 per cent, up from the current 50 to 70 per cent.
Mr Heng said: "With the large part of the risks taken up by the government, I trust that our financial institutions will do their part to support our viable SMEs."
In addition, tenants and lessees of government-managed properties can also ask for flexible rental payments such as instalment plans.
This measure covers properties managed by JTC Corporation, Housing & Development Board, Singapore Land Authority amd Singapore Tourism Board.
For more Budget 2020 stories, visit bt.sg/budget20.