Will incentives lead to desired SME outcomes?
Economists look at impact on areas such as innovation
Add BT as a preferred source[SINGAPORE] Budget 2014 may have extended more carrots than sticks to businesses, but whether these extra incentives will meet SMEs' needs or raise productivity, innovation and competitiveness is more pertinent, according to panellists at the Economics Society of Singapore's post-Budget roundtable yesterday.
Citing results from KPMG's pre-Budget survey, KPMG tax partner Toh Boon Ngee noted that 65 per cent of businesses said the government's measures have enabled them to invest in equipment or raise labour productivity. Even so, half of the survey respondents said the measures have had "no impact" on innovation.
The question of what innovation is and how it ought to be defined under the Productivity and Innovation Credit (PIC) Scheme - which has been extended by three years and enhanced for SMEs - is important, said Ms Toh.
