Singapore Budget 2023: Support for Individuals & Households
Singapore’s Budget for 2023 aims to tackle some of the short and long-term challenges facing Singaporean individuals and households. This includes providing cash support to address the high cost of living as well as support family planning.
Singapore’s 2023 Budget provides a multi-faceted package for individuals and domestic households to address short-term challenges such as tackling inflation and the high cost of living, as well as long-term challenges like supporting family planning, and ensuring income mobility and equality in Singapore.
To support the global competitiveness of Singaporean businesses, the government has provided tax deductions for research and development, tax deduction for the training of the workforce, and expanded and extended financing scheme for companies.
Further, Singapore’s Budget 2023 also offers a variety of support for employees, such as co-funding workers’ wages, as well as enhancing opportunities for reskilling and upskilling.
What support is available for Singaporean households under Budget 2023?
Enhancing the GST voucher scheme
To help Singaporeans with the increasing cost of living and cushion the impact of the hike in the goods and services tax (GST), the government has enhanced the GST voucher scheme.
The GST voucher scheme was introduced in Budget 2012 to assist lower and middle-income Singaporeans cope with paying GST expenses. GST is a value-added tax levied on most supplies of goods and services as well as on imported goods. Singapore raised its GST rate on January 1, 2023, to eight percent from seven percent, and will increase again in 2024 to nine percent.
The scheme comprises four components:
- Cash, for immediate needs;
- MediSave, helps senior citizens pay for their medical needs;
- U-Save, to help offset utility bills; and
- Service and conservancy charges (S&CC) rebates.
Singaporeans aged 21 and older who live in a home with an annual value of less than S$13,000 (US$9,604) will receive S$700 (US$517) in one-off cash assistance for 2023.
Those with homes that have an annual value of between S$13,000 (US$9,604) and S$21,000 (US$15,500) will receive S$350 (US$258) in one-off cash assistance.
The cash will be disbursed in August 2023.
The government will top up S$150 (US$110) to the MediSave accounts for those up to 20 years old. The funds will be disbursed in February 2023, 2024, and 2025.
Singaporeans have received between S$55 (US$40) and S$95 (US$70) in U-Save rebates with the first payment conducted in January 2023. The next payments will be in January 2024 and 2025.
Service and conservancy charges (S&CC) rebates
This is a rebate to offset the service and conservancy charges for those living in Housing Development Board (HDB) apartments.
The government has topped up the Assurance Package (AP) scheme by S$3 billion (US$2.2 billion) under Budget 2023. The AP scheme was introduced under Budget 2020 to help Singaporeans offset the planned increase in GST.
Under the AP scheme, Singaporeans aged 21 and above who earn no more than S$100,000 (US$73,900) per year and do not own more than one property, will receive additional cash assistance of between S$300 (US$221) and S$650 (US$480) over the next four years. This is expected to benefit around 2.5 million Singaporeans.
Further, this also means total cash payouts of between (US$517) and S$2,250 (US$1,662) over five years from 2022 to 2026 to eligible Singaporean adults.
The cash will be disbursed every December until 2026.
Cost of living special payment
Any Singaporean aged 21 and above, earning S$100,000 (US$73,900) or less per year, and owning not more than one property will receive a one-off cash payment of between S$200 (147) and S$400 (US$295). The funds will be disbursed in June 2023.
Every Singaporean household will receive an additional $300 (US$221) in Community Development Council (CDC) vouchers in January 2024. This is S$100 (US$73) more than was previously announced.
Cost of living U-Save special payment
Singaporean households living in HDB apartments and whose members do not own more than one property will receive double the amount of U-Save rebates for the rest of this year. As such, households can receive between S$440 (US$325) and S$760 (US$561) in rebates for 2023.
Increase in the baby bonus cash gift
The government has increased the baby bonus cash gift scheme by S$3,000 (US$2,218). This means that for the first and second children, parents will receive S$11,000 (US$8,132) from the previous S$8,000 (US$5,914). For the third child, parents will receive S$10,000 (US$7,393).
Eligible parents can expect payments of up to S$9,000 (US$6,653) for the first 18 months of their child’s life, and S$400 (US$295) every six months from when the child is aged two to 6½ years old.
Working mother’s child relief
This tax relief scheme aims to encourage women to stay at work after having children. Eligible working mothers can claim up to S$8,000 (US$5,914) in tax relief for the first child, S$10,000 (US$7,393) for the second child, and S$12,000 (US$8,871) each for the third and any subsequent children.
Previously, the cash relief was based on a percentage of the mother’s income ranging from 15 to 25 percent.
ASEAN Briefing is produced by Dezan Shira & Associates. The firm assists foreign investors throughout Asia and maintains offices throughout ASEAN, including in Singapore, Hanoi, Ho Chi Minh City, and Da Nang in Vietnam, in addition to Jakarta, in Indonesia. We also have partner firms in Malaysia, the Philippines, and Thailand as well as our practices in China and India. Please contact us at email@example.com or visit our website at www.dezshira.com.