Delaying GST increase high on wish list for SMEs in community and personal, professional services industries: UOB

Mindy Tan

Published Tue, Feb 15, 2022 · 06:19 PM

Singapore Budget 2022

A SIGNIFICANTLY higher percentage of small and medium-sized enterprises (SMEs) in the community and personal, and professional services industries are hoping for a delay in the implementation of the Goods and Services Tax (GST) increase, according to UOB's SME Outlook Study 2022.

A whopping 42 per cent of businesses in the community and personal space, followed by 41 per cent of those in the professional services space said they hope for a delay; this compares with the overall average of 28 per cent.

Topping the wish list of the 800 SMEs surveyed between Dec 20 last year and Jan 7 this year was "extend Jobs Support Scheme" (53 per cent); "grants and extra funding for digital adoption" (43 per cent); and "extend wage credit scheme" (41 per cent).

Notably, more SMEs are looking for support from the government in the areas of sustainable practices (29 per cent) and export opportunities (25 per cent) this year, as compared to 2021.

Last year, only 20 per cent of SMEs voted for each of these options.

Overall, medium-sized businesses are generally more positive about the expected impact of the 2022 Budget initiatives on their business as compared with small businesses.

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Medium-sized businesses are defined as having a turnover of between S$10 and S$100 million.

The study also found that medium-sized businesses are applying for a greater range of budget initiatives as compared with small businesses.

These include the SME Working Capital Loan (12 per cent of small businesses versus 19 per cent of medium-sized businesses); SMEs Go Digital (16 per cent versus 20 per cent) and the Enterprise Development Grant (15 per cent versus 21 per cent).

The survey further noted that wholesale trade SMEs are the most positive about the expected impact of the 2022 Budget initiatives on their business.

This group are also the most aware of Budget initiatives, whereas those in the consumer goods sector are the least aware.

Overall, the SMEs surveyed are most familiar with the Jobs Support Scheme (48 per cent), SkillsFuture Enterprise Credit scheme (43 per cent), the Wage Credit Scheme (40 per cent) and the SMEs Go Digital programme (35 per cent).