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| Source: Budget 2018 site. View of Singapore skyline. |
In 2018, the Singapore Ministry of Trade and Industry (MTI) expects growth to be more broad-based across sectors, moderated from the high of 2017, said Singapore Financial Minister Heng Swee Keat during his Budget 2018 speech.
In his speech Minister Heng said Singapore must prepare for three shifts in the next decade:
- A shift in global economic weight towards Asia.
Some indications of this trend include China's new regional infrastructure bank and plans under the Belt and Road Initiative; economic reform in India, including the easing of restrictions on foreign investments; and a growing middle class in ASEAN countries, which are moving up the value chain, Heng said.
"All these developments represent significant opportunities for our firms and people. Our economy must be geared to ride on and contribute to Asia’s growth," he said.
- The emergence of new technologies, and its implications for lifelong learning.
"Firms will compete increasingly not on physical assets, but on intangible assets, such as intellectual property (IP), data, and user networks. First-mover advantage and time to market will be key.
"Securing better jobs and higher wages will not be just about how well we did in school, but how well we continue to learn, relearn, adapt and grow throughout our lives," he said.
- A greying population, with implicatons for healthcare and social expenditure, as well as the tightening of the labour market if productivity and "a calibrated inflow" of workers from abroad are neglected.
Heng sees the three shifts interacting to bring new opportunities as well as new challenges. He listed the possibility of technology helping older workers to stay productive, contrasting it with the rapid pace of change potentially causing the same workers to feel marginalised.
This year's Budget will guard against the challenges while capturing opportunities, he said, specifically:
- Developing a more vibrant and innovative economy
"We must anchor Singapore as a Global-Asia node of technology, innovation and enterprise, welcome investments, talent and ideas to Singapore, and be bold in venturing out into new markets. "To do this, we must make innovation pervasive in our economy, develop deep capabilities in our firms and workers, and establish strong partnerships locally and abroad. "The shifts in the global economy and the emergence of new technologies are to our advantage, because they allow us to seize opportunities beyond our borders," he said.
- Build a smart, green and liveable city.
"We should take full advantage of the latest technology to improve Singaporeans’ quality of life," Heng said. "To improve our liveability as a city, we must also enhance our urban sustainability and enable our economy to be more carbon-efficient."
- Foster a caring, cohesive society, and plan ahead for sustainable, secure future.
Strategies towards a more innovative economy include:
- Extending the Wage Credit Scheme (WCS). This initiative co-funds wage increases for Singaporean employees, up to a gross monthly wage of S$4,000. The WCS has been extended for three more years. It will provide 20% co-funding for 2018, 15% for 2019 and 10% for 2020.
- Enhance the Corporate Income Tax (CIT) rebate. For the Year of Assessment (YA) 2018, the rebate is raised to 40% of tax payable, capped at S$15,000. In YA2019, it will be at a rate of 20% of tax payable, capped at S$10,000.
- Better support for employees, including upgrading the current Work Trial scheme into a Career Trial scheme, with higher funding support for workers to try out new careers. In 2017, Heng said the government's Professional Conversion Programmes (PCPs) helped more than 3,700 mid-career individuals take up new jobs.
In the longer term, Singapore's transformation will rely in part on Industry Transformation Maps (ITMs) which outline how various industries can digitalise. To date, 21 out of 23 proposed ITMs have been launched, Heng said, with the remaining two to be introduced by end-March. The food services ITM was launched in September 2016, while the financial services ITM and the infocomm media industry ITM were introduced in November 2017. The security industry ITM was released in February 2018.
"The tripartite Future Economy Council (FEC) is now overseeing the implementation of these ITMs and the strategies laid out by the Committee on the Future Economy (CFE)," he said.
"Though new, the ITMs are helping to prepare our companies for a new phase of growth. For instance, as part of the precision engineering ITM, several companies in the sector, like Univac Precision Engineering and Globaltronic Precision, have undertaken projects to make better use of digital technologies in their manufacturing processes. This has enabled them to stay competitive and take advantage of the global economic recovery," he said.
In the next phase of the ITM journey, an ecosystem approach will come into play so that synergies can be reaped, interconnections strengthened, and opportunies explored, he said. The foundation for the ITMs lie in innovation, capabilities and partnerships, all of which will are a focus going forward, Heng said. "By strengthening these three enablers, we can anchor Singapore as a Global-Asia node of technology, innovation and enterprise."
New initiatives include supporting more firms to innovate across the entire value chain:
- Supporting businesses to buy and use new solutions. Existing grants that support the adoption of prescoped, off-the-shelf technologies will be consolidated into a single Productivity Solutions Grant (PSG).
- Tax deductions on licensing payments for the commercial use of intellectual property (IP) will be raised.
- A new Open Innovation Platform will be piloted this year. This marketplace will match companies looking for digital solutions to their challenges with infocommunications and technology (ICT) firms and research institutes to co-develop solutions, Heng explained.
- National research capabilities will be a focus for FY2018, backed by public sector R&D spending at 1% of GDP annually. This year, the National Research Foundation (NRF) and Temasek will launch an NRF-Temasek IP Commercialisation Vehicle.
"This new investment venture will bring together Temasek’s global investment networks and NRF’s connections with the Singapore R&D community, to grow companies that draw on IP from publicly-funded research," said Heng. "At least S$100 million will go into this joint venture – S$50 million from the government, and at least S$50 million from Temasek."
In addition to the ITMs, special attention is on strengthening Singapore's position as an air and sea hub, leading to a new Aviation Transformation Programme (ATP) and a Maritime Transformation Programme (MTP) this year, Heng said.
"Through these programmes, our airport and seaport will become platforms for companies to develop, test and use new technologies," he said. "The solutions that emerge can be rapidly adopted in other parts of Singapore, or even exported overseas. We will provide support of up to S$500 million for the two programmes, with additional matching investments expected from industry partners."
The built environment sector is also singled out for attention this year with support from an expanded National Robotics Programme (NRP).
More targeted support is in the offing for enterprises:
- Merger of SPRING and IE Singapore into Enterprise Singapore this April
"Enterprise Singapore will provide integrated support to companies, for internationalisation as well as the development of other capabilities, so as to help them compete better both locally and abroad," Heng explained. "We will combine IE’s Global Company Partnership grant with SPRING’s Capability Development Grant, to form an integrated Enterprise Development Grant (EDG). The EDG will provide up to 70% co-funding for companies to develop a range of capabilities."
- Enhanced Double Tax Deduction for Internationalisation (DTDi) in YA2019
The amount of expenses that can qualify for the DTDi without prior approval has been raised from S$100,000 to S$150,000 per year of assessment as of YA2019. From YA2020, changes have been made to the Start-up Tax Exemption and the Partial Tax Exemption schemes. Tax exemptions under both schemes will be restricted to the first S$200,000 of chargeable income. Startups will enjoy a 75% exemption instead of 100% as currently, of their first S$100,000 of chargeable income from corporate tax.
"These schemes help lower costs for smaller firms and startups, but do not directly help firms develop capabilities. In addition, every profitable company should pay some taxes. This is sound and equitable," Heng said of the changes. "Even with these adjustments, corporate tax will remain low for startups and smaller firms. For a taxable income of S$100,000, the effective corporate tax rate is 4.3% for start-ups and 8.1% for older firms, as compared to the headline rate of 17%."
Digital transformation support includes:
- A possible nationwide e-invoicing framework to help companies improve productivity and enhance cash flow
- Expansion of the Tech Skills Accelerator (TeSA) into new sectors such as manufacturing and professional services, with the focus on digital technologies. Launched in 2016, TeSA has trained over 27,000 people in digital skills. Heng listed skills such as data analytics, artificial intelligence (AI), the Internet of Things (IoT) and cybersecurity as the focus today.
Equipping employees with "deep skills" in general continues to be important. A new ASEAN Leadership Programme under the the SkillsFuture Leadership Development Initiative (LDI) will help business leaders build networks and plan business expansions in Southeast Asian markets, Heng said. The LDI has already helped to train nearly 200 Singaporeans, with 180 in the pipeline, Heng said.
Existing initiatives to help the workforce develop deep skills include:
- The SkillsFuture Earn and Learn Programme, a work-learn programme;
- The Go Southeast Asia Award, which matches undergraduates with regional internships;
- The SkillsFuture Mid-Career Enhanced Subsidy;
- The PCPs, including the PCP for Southeast Asia Ready Talent which equips Singaporeans with the knowhow to do well regionally.
- Heng also highlighted private sector efforts, such as the Singapore Business Federation (SBF) and Singapore Management University (SMU) piloting the SBF-SMU LEAD-CHARGE Initiative this year to help small and medium sized enterprise (SME) leaders transform their organisations.
For older workers, the government has raised the re-employment age to 67, extended the Special Employment Credit, and enhanced WorkPro. WorkPro provides funding for the implementation of work-life measures, job redesign, improved workplace practices or flexible work schemes. Re-employment refers to the legal requirement for employers to give eligible employees the option to continue working, or to retire as they choose.
"With the close cooperation of the tripartite partners, Singapore’s employment rate for residents aged 65 and above rose from 14.4% in 2007 to 25.8% in 2017*," said Heng. "We will continue to encourage age-friendly workplaces, and review how we can better support our older workers."
A new Capability Transfer Programme (CTP) will also be piloted to support the transfer of skills from foreign specialists to Singaporean trainers and trainees.
Collaboration in technology, innovation and enterprise will be a government focus for the year. "Where synergies exist, we can achieve more when we work together, and draw on one another’s strengths to address common challenges and capture bigger and better opportunities," Heng said. "We will continue to encourage our companies to form strong partnerships, both locally and abroad."
Various partnership support measures will be consolidated into a single Partnerships for Capability Transformation or PACT scheme. Under PACT, companies can receive up to 70% co-funding for projects undertaken in partnership with others.
Innovation has gone global, the Singapore way. In the past year, Heng said that the Global Innovation Alliance (GIA), launched last year, has seen early progress. Overseas internship programmes at universities have expanded to new locations, GIA Beijing was launched, as was Block71 in Suzhou, China and Jakarta, Indonesia. The original Block71 in Singapore is a space for entrepreneurs and innovation. Heng added that global innovation is also being shared through initiatives like the Singapore Week of Innovation and Technology (SWITCH).
"As ASEAN chairman this year, we hope to make a meaningful contribution by developing an ASEAN Innovation Network. We hope this will strengthen the linkages among the innovation ecosystems in the region, and spark new collaborations and solutions," Heng said.
He also welcomed participation from trade associations and chambers (TACs) in forging partnerships and advancing the industry. Case in point is the Logistics Alliance, which last year launched the digital Transport Integrated Platform (TRIP) to enable easier tracking of container trucks, and reduce idling time, Heng said. The government will continue to support such efforts, through the Local Enterprise and Association Development (LEAD) programme, he noted.
The proposed carbon tax, to take effect in 2019, is on track, Heng shared. "We have to start preparing early so that industries have more time to adapt," he said.
Such a tax is likely to affect electronics manufacturers, for example. Heng said the carbon tax will be S$5 per tonne of greenhouse gas emissions from 2019 to 2023. The plan is to increase it to a rate of between S$10 and S$15 per tonne of emissions by 2030.
"The carbon tax will apply uniformly to all sectors, without exemption. This is the economically efficient way – to maintain a transparent, fair and consistent carbon price across the economy to incentivise emissions reduction," Heng said. The premise is that businesses will be encouraged to reduce their carbon emissions in line with requirements from other countries, as well as international agreements on climate change. At the same time, Heng estimated that the impact of the carbon tax on households would only be 1% of total electricity and gas expenses on average.
Heng also touched on a widely anticipated rise in taxes. National expenditure will require a higher goods and services tax (GST) from 7% to 9% from 2021 to 2025, Heng said. "The exact timing will depend on the state of the economy, how much our expenditures grow, and how buoyant our existing taxes are. But I expect that we will need to do so earlier rather than later in the period.
"This GST increase is necessary because even after exploring various options to manage our future expenditures through prudent spending, saving and borrowing for infrastructure, there is still a gap," he said.
Another anticipated increase in taxes - GST on imported services, widely thought to be an "e-commerce tax" before the Budget announcement - will come into play on 1 January 2020, he said. "Today, services such as consultancy and marketing purchased from overseas suppliers are not subject to GST. Local consumers also do not pay GST when they download apps and music from overseas. This change will ensure that imported and local services are accorded the same treatment," he said.
Industry reactions to the Budget included:
"Finally the end of the PIC scheme. It is welcoming that the Singapore government is providing more targeted support for companies to embrace innovation including raising tax deduction for IP registration fees to 200%, capped at S$100,000 a year. Some licensing payments, such as use of trademarks and brand names, may not lead to innovation. It remains to be seen what the scope of the enhanced deduction scheme is," said Lennon Lee, Entrepreneurial & Private Clients Tax Leader, PwC Singapore. PIC, or the Productivity and Innovation Credit Scheme, gave businesses 400% tax deductions/allowances for qualifying expenditure incurred in any of six qualifying activities from YA2011 to YA2018.
Lee said "all is not lost with the end of the PIC scheme". "...SMEs can now tap on the PSG which subsidises up to 70% of approved costs for the purchase and use of new productivity and innovative solutions."
"Laudable tax measures to encourage Singapore’s IP ecosystem. Enhanced tax deduction for Research & Development in Singapore, IP reregistration and licence payments should enable our SMEs to invest more on innovation and embrace greater use of technology to be efficient and effective," said Abhijit Ghosh, Corporate Tax Partner, PwC Singapore. Tan Tay Lek, Corporate Tax Partner, PwC Singapore added, "I had wanted to see the deduction limit raised to 300% but 250% is not bad. It helps put us in a good position to compete internationally for R&D dollars and more importantly, to attract R&D talent."
"Laudable tax measures to encourage Singapore’s IP ecosystem. Enhanced tax deduction for Research & Development in Singapore, IP reregistration and licence payments should enable our SMEs to invest more on innovation and embrace greater use of technology to be efficient and effective," said Abhijit Ghosh, Corporate Tax Partner, PwC Singapore. Tan Tay Lek, Corporate Tax Partner, PwC Singapore added, "I had wanted to see the deduction limit raised to 300% but 250% is not bad. It helps put us in a good position to compete internationally for R&D dollars and more importantly, to attract R&D talent."
Alex Campbell, MD Asia, Xero, welcomed the government’s initiative to financially support small businesses adopting digital technology and saw the PSG in a positive light. “This year’s Budget is not a game-changer, which is great news for Singapore’s small business community. We need to keep our foot firmly on the accelerator and help digitise more homegrown small businesses, faster.
"For example, we recently released a study which found that small businesses here spend on average five workweeks each year manually chasing late payments from their customers. That’s a huge productivity drain which can be significantly minimised using digital technology - mostly funded by the newly-announced single PSG. Addressing these issues that are holding back small businesses is key to unlocking productivity, innovation and global expansion,” he said.
"To be expansive, the new GST ruling affects digital services like ride-sharing, food ordering, ticket sales (movies), and video on-demand providers. Broadening the tax base to include digital service providers should bring added resilience to the digital business ecosystem over the long term. Fairness can only be ascertained, if and when, the new GST ruling supports or disrupts local digital startups that create new digital workforces. Point of note, digital services constantly evolve. Innovative, forward-thinking service providers will take this in their stride as a matter of doing business in Singapore. They aim squarely at differentiating and gaining market share though unique and rich user experiences," Lee said.
"Digital service providers will face increased operational costs for compliance with the new tax regime. Service providers will need to ramp up to handle GST reconciliation with IRAS once they cross the S$100,000 threshold. Coupled with the proposed increase in GST to 9% across all businesses from 2021, this hits the digital service providers domiciled both in and outside of Singapore with additional margin pressures as they strive to remain profitable. Needless to say, this will dampen the growth of digital services in Singapore but should not constrain it, as consumers progressively digitise their services. It is a positive sign from the Singapore government that digital businesses are given notice until January 2020 to prepare for this," he added.
Consumers are also expected to rein in their online spending behaviour as a result. "In Gartner’s 2017 Mobile Apps Survey conducted across US, UK and China; music and video apps ranked as the 6th and 7th most used smartphone apps. Similarly in our mature market, 59% of all Singaporeans have reported purchasing a product or service online. B2C apps like Grab, Uber and Spotify occupy the top 10 spots with the most monthly active users," Lee said.
"Where there is no viable replacement service, i.e. Grab or Uber for Singapore transport, consumers might reduce and/or (consider) lower-value purchases. I do not think consumers will stop buying online. They will simply choose to spend more prudently."
Lee added that service providers will deal with the higher GST by:
- Offering their own ‘amnesty’ for a period to their high value customers to mitigate the effects
- Focusing on partnerships with digital payment providers/credit card companies to deliver greater incentives against spend
- Proactively lobbying for progressive tax structures to soften the impact, based on revenues earned.
"This should not, however, trigger any sort of a price war between competitive services as it applies across the board," Lee predicted.
Based on Gartner’s consumer personas, savvy "Enthusiast" consumers (24% of users) are expected to seek other digital providers to provide similar or comparable services, Lee noted. "The Internet is porous by nature and the new tax will alter consumption habits. For non-urgent needs, consumers will plan their online purchases for when a suitable promotion or campaign occurs."
Lee shared that in Gartner’s consumer personas, typically the 'Technology Late Adopters' (20% of users) will be held back by price, as one of their top barriers to consuming a digital service.
While an e-commerce tax was not announced, Lee is expecting one to be announced eventually. "Digital commerce service providers need to stand prepared. Innovative, forward-thinking physical retailers are already in digital commerce. These retailers are differentiating though a unified retail experience for consumers - with solid examples from Uniqlo, Sephora and Nike.
"Taxing pure players in digital commerce (like Shopee, Qoo10, Lazada, or Amazon) signals to traditional retailers that it is acceptable to do ‘business as usual’ in a declining physical retail market. Something needs to click for traditional retailers who insist on brick-and-mortar only. The tax might diversify the base, but on its own cannot sufficiently stimulate physical retail. In 2018, physical retailers should already be implementing/harvesting digital transformation; so as to respond to new retail models such as the unmanned store pilots from Alibaba, user-selectable delivery slots from Amazon Prime or digital wallets from GrabPay," he said.
"The reverse charge mechanism to tax business-to-business (B2B) transactions has long been in our GST legislation but was never effected until the Minister's announcement in Budget 2018. With the increase in cross-border services received by businesses in Singapore, the reverse charge could no longer stay dormant and would impact businesses in sectors such as financial services and residential property development which are unable to fully claim the GST on their business purchases," said Koh Soo How, Asia Pacific Indirect Tax Leader, PwC Singapore.
"If there is a question of how the Government would be able to enforce the GST registration for an overseas vendor for business-to-consumer (B2C) transactions, we must bear in mind that the tax authorities have exchange of information arrangements that would enable the jurisdictions to exchange information on overseas vendors which are already registered in the local territories."
Koh said that taxing the digital economy from 2020 will make e-commerce tax a virtual reality in Singapore. "The introduction of the e-commerce tax will make Singapore the first country in Southeast Asia to introduce a tax on the digital economy. This is likely to be followed by Thailand, Malaysia and Indonesia which are already considering such a tax," he said.
According to Koh, "The fact that the e-commerce tax will only apply to services show the practical difficulties and complexities that various jurisdictions face in trying to introduce an effective collection mechanism to tax low value imports of goods. We expect the government to take a wait-and-see approach and learn from the experiences of other countries before expanding the new rules to tax low value imports."
Singapore also shared economic statistics as part of its Budget statement for FY2018:
- GDP grew by 3.6%**, up from 2.4% in 2016.
- Productivity grew 4.5% as measured by real value-added per actual hour worked, and 3.8% as measured by real value-added per worker. These are the highest figures since 2010.
- Real median income*** for Singapore citizens rose by 5.3%**** last year.
Singapore's financial year runs from 1 April to 31 March.
Explore:
Read the Budget Speech in full
Hashtag: #SGBudget2018
*Source: Singapore Ministry of Manpower's (MOM’s) Comprehensive Labour Force Survey
**Source: MTI’s Economic Survey of Singapore 2017.
***Median gross monthly income of full-time employed Singapore citizens.
****Source: MOM’s Labour Market Advance Release 2017.
"For example, we recently released a study which found that small businesses here spend on average five workweeks each year manually chasing late payments from their customers. That’s a huge productivity drain which can be significantly minimised using digital technology - mostly funded by the newly-announced single PSG. Addressing these issues that are holding back small businesses is key to unlocking productivity, innovation and global expansion,” he said.
Adrian Lee, Research Director at Gartner, said that GST on imported services would impact digital service providers and consumers.
"To be expansive, the new GST ruling affects digital services like ride-sharing, food ordering, ticket sales (movies), and video on-demand providers. Broadening the tax base to include digital service providers should bring added resilience to the digital business ecosystem over the long term. Fairness can only be ascertained, if and when, the new GST ruling supports or disrupts local digital startups that create new digital workforces. Point of note, digital services constantly evolve. Innovative, forward-thinking service providers will take this in their stride as a matter of doing business in Singapore. They aim squarely at differentiating and gaining market share though unique and rich user experiences," Lee said.
"Digital service providers will face increased operational costs for compliance with the new tax regime. Service providers will need to ramp up to handle GST reconciliation with IRAS once they cross the S$100,000 threshold. Coupled with the proposed increase in GST to 9% across all businesses from 2021, this hits the digital service providers domiciled both in and outside of Singapore with additional margin pressures as they strive to remain profitable. Needless to say, this will dampen the growth of digital services in Singapore but should not constrain it, as consumers progressively digitise their services. It is a positive sign from the Singapore government that digital businesses are given notice until January 2020 to prepare for this," he added.
Consumers are also expected to rein in their online spending behaviour as a result. "In Gartner’s 2017 Mobile Apps Survey conducted across US, UK and China; music and video apps ranked as the 6th and 7th most used smartphone apps. Similarly in our mature market, 59% of all Singaporeans have reported purchasing a product or service online. B2C apps like Grab, Uber and Spotify occupy the top 10 spots with the most monthly active users," Lee said.
"Where there is no viable replacement service, i.e. Grab or Uber for Singapore transport, consumers might reduce and/or (consider) lower-value purchases. I do not think consumers will stop buying online. They will simply choose to spend more prudently."
Lee added that service providers will deal with the higher GST by:
- Offering their own ‘amnesty’ for a period to their high value customers to mitigate the effects
- Focusing on partnerships with digital payment providers/credit card companies to deliver greater incentives against spend
- Proactively lobbying for progressive tax structures to soften the impact, based on revenues earned.
"This should not, however, trigger any sort of a price war between competitive services as it applies across the board," Lee predicted.
Based on Gartner’s consumer personas, savvy "Enthusiast" consumers (24% of users) are expected to seek other digital providers to provide similar or comparable services, Lee noted. "The Internet is porous by nature and the new tax will alter consumption habits. For non-urgent needs, consumers will plan their online purchases for when a suitable promotion or campaign occurs."
Lee shared that in Gartner’s consumer personas, typically the 'Technology Late Adopters' (20% of users) will be held back by price, as one of their top barriers to consuming a digital service.
While an e-commerce tax was not announced, Lee is expecting one to be announced eventually. "Digital commerce service providers need to stand prepared. Innovative, forward-thinking physical retailers are already in digital commerce. These retailers are differentiating though a unified retail experience for consumers - with solid examples from Uniqlo, Sephora and Nike.
"Taxing pure players in digital commerce (like Shopee, Qoo10, Lazada, or Amazon) signals to traditional retailers that it is acceptable to do ‘business as usual’ in a declining physical retail market. Something needs to click for traditional retailers who insist on brick-and-mortar only. The tax might diversify the base, but on its own cannot sufficiently stimulate physical retail. In 2018, physical retailers should already be implementing/harvesting digital transformation; so as to respond to new retail models such as the unmanned store pilots from Alibaba, user-selectable delivery slots from Amazon Prime or digital wallets from GrabPay," he said.
"The reverse charge mechanism to tax business-to-business (B2B) transactions has long been in our GST legislation but was never effected until the Minister's announcement in Budget 2018. With the increase in cross-border services received by businesses in Singapore, the reverse charge could no longer stay dormant and would impact businesses in sectors such as financial services and residential property development which are unable to fully claim the GST on their business purchases," said Koh Soo How, Asia Pacific Indirect Tax Leader, PwC Singapore.
"If there is a question of how the Government would be able to enforce the GST registration for an overseas vendor for business-to-consumer (B2C) transactions, we must bear in mind that the tax authorities have exchange of information arrangements that would enable the jurisdictions to exchange information on overseas vendors which are already registered in the local territories."
Koh said that taxing the digital economy from 2020 will make e-commerce tax a virtual reality in Singapore. "The introduction of the e-commerce tax will make Singapore the first country in Southeast Asia to introduce a tax on the digital economy. This is likely to be followed by Thailand, Malaysia and Indonesia which are already considering such a tax," he said.
According to Koh, "The fact that the e-commerce tax will only apply to services show the practical difficulties and complexities that various jurisdictions face in trying to introduce an effective collection mechanism to tax low value imports of goods. We expect the government to take a wait-and-see approach and learn from the experiences of other countries before expanding the new rules to tax low value imports."
Said Ryan Goh, VP and GM, Zebra Technologies Asia Pacific: "There has been a worldwide shift toward an on-demand economy, which rewards businesses that are able to deliver what customers want, when they want it, and how they want it delivered. The ability to meet heightened expectations today can be achieved through a business’s digital capabilities. Aspects of these capabilities include their ability to leverage the 3A’s: analytics, automation and artificial intelligence.
"Any allocation of expenditure toward helping SMEs here tap on such solutions will go a long way toward giving them a leg up – so they are able to efficiently capture opportunities in and out of Singapore, particularly in the manufacturing sector.
"The impact of efforts to promote digital transformations will be particularly interesting to track in Singapore’s manufacturing sector, given the resurgence of this sector over the last year. This is especially so in the field of advanced manufacturing – which is one of eight emerging areas identified, under the SkillsFuture push to help equip adult learners with industry-relevant skills and prepare them to take on jobs.
"Notably, Singapore has a strong manufacturing base that’s leading the charge for advanced manufacturing – or what we call Industry 4.0. Far from being an endeavour for large enterprises only – we believe the journey toward Industry 4.0 holds great rewards for SMEs too."
Goh shared that in the APAC Manufacturing Vision Study by Zebra Technologies, manufacturers throughout the region are looking to tap on technologies for competitive advantages. "For example, the study predicted that 72% will have incorporated the use of mobile computers by 2022, compared to 27% last year. Similarly, 65% of respondents will use wearable technologies by 2022, while only 38% currently take advantage of such solutions. By leveraging technological solutions for increased operational visibility, manufacturers will be well-placed to respond to the on-demand economy by ensuring that the right assets are in the right place at the right time," he said.
"Any allocation of expenditure toward helping SMEs here tap on such solutions will go a long way toward giving them a leg up – so they are able to efficiently capture opportunities in and out of Singapore, particularly in the manufacturing sector.
"The impact of efforts to promote digital transformations will be particularly interesting to track in Singapore’s manufacturing sector, given the resurgence of this sector over the last year. This is especially so in the field of advanced manufacturing – which is one of eight emerging areas identified, under the SkillsFuture push to help equip adult learners with industry-relevant skills and prepare them to take on jobs.
"Notably, Singapore has a strong manufacturing base that’s leading the charge for advanced manufacturing – or what we call Industry 4.0. Far from being an endeavour for large enterprises only – we believe the journey toward Industry 4.0 holds great rewards for SMEs too."
Goh shared that in the APAC Manufacturing Vision Study by Zebra Technologies, manufacturers throughout the region are looking to tap on technologies for competitive advantages. "For example, the study predicted that 72% will have incorporated the use of mobile computers by 2022, compared to 27% last year. Similarly, 65% of respondents will use wearable technologies by 2022, while only 38% currently take advantage of such solutions. By leveraging technological solutions for increased operational visibility, manufacturers will be well-placed to respond to the on-demand economy by ensuring that the right assets are in the right place at the right time," he said.
Singapore also shared economic statistics as part of its Budget statement for FY2018:
- GDP grew by 3.6%**, up from 2.4% in 2016.
- Productivity grew 4.5% as measured by real value-added per actual hour worked, and 3.8% as measured by real value-added per worker. These are the highest figures since 2010.
- Real median income*** for Singapore citizens rose by 5.3%**** last year.
Singapore's financial year runs from 1 April to 31 March.
Read the Budget Speech in full
Hashtag: #SGBudget2018
*Source: Singapore Ministry of Manpower's (MOM’s) Comprehensive Labour Force Survey
**Source: MTI’s Economic Survey of Singapore 2017.
***Median gross monthly income of full-time employed Singapore citizens.
****Source: MOM’s Labour Market Advance Release 2017.
