In this month’s publication, we refer to an article by EY, stating its wish list for Singapore Budget 2021. The main purpose for EY’s wish list is to support companies and individuals to rebuild their finances and livelihoods for the future.
As a result of the pandemic, cashflow has become a challenge for many companies. To tackle this challenge, EY is proposing several measures to help companies that are seeking to leverage borrowings and employee outplacement to keep business going or execute M&As or divestments as part of their capital and growth strategy. One of these measures includes the introduction of Covid-19 relief or rebate since there are currently limited direct reliefs for individuals.
The pandemic has also made companies in Singapore realise the need to enhance productivity and innovation to futureproof their business. As such, EY has suggested to introduce new tax schemes that would encourage more companies to do so. This includes the consideration of a non-taxable tax credit for R&D expenditure.
The way people work and behave has become different with the pandemic as well. With employees having to work from home, companies must adapt to these changes. EY is calling for several measures to drive workforce transformation. An example is to have further enhancements for the Jobs Growth Incentive (JGI) Scheme.
Lastly, there are certain sectors whose growth are important in the current Covid-19 world. With the telecommunications sector providing 5G services, EY is suggesting allowing tax deductions or allowances for expenditure incurred on 5G spectrum which are currently not tax deductible.