Budget 2022 Singapore preview: What will it bring?

PHOTO: Seedly

As a personal finance platform in Singapore, one of the year’s most significant events is the Singapore Budget.

The reason for this is simple.

The budget will have a material impact on the personal finances of everybody living in Singapore.

This year’s budget is no different as hot button issues like the rising cost of living in Singapore, a re-examination of wealth taxes, and the 2024 revised carbon tax rate will be covered.

Not to mention details of the timeline for the impending goods and services (GST) hike after Prime Minister Lee Hsien Loong announced in December 2021 that the Government will ‘start moving’ with its plans to increase GST from 7 per cent to 9 per cent for Budget 2022.

We will be covering the Singapore Budget 2022 live on Friday, Feb 18, 2022 at 3.30pm.

But for now, we will cover what we know so far and answer some popular questions people have about the budget.

TL;DR: Singapore Budget 2022 summary preview: Singapore Budget announcement news

PHOTO: Seedly

What Is Singapore Budget about?

I’m stating the obvious here, but you need to spend money to run a country.

Singapore’s healthcare, housing, educatio, economy, security and sustainability all come at a cost.

This is where the Singapore Budget comes in.

Before the start of each financial year (FY), the Singapore Government will take into consideration the country’s needs to develop the annual budget.

FYI: The financial year starts on April 1 and concludes on March 31 the year after.

The annual budget can be broken down into two main components:

  • The revised Government revenue and expenditure for the current FY
  • And Government revenue and expenditure for the following FY.

In addition, the budget will answer questions like:

  • How does the Government plan its revenue and spending each year?
  • How are finite resources allocated?
  • Are the plans sustainable and financially viable?
  • What trade-offs will be made?

When is the Singapore Budget 2022 happening

So you might be wondering when these questions will be answered.

The budget will be presented by the incumbent Minister for Finance, Mr Lawrence Wong, on Friday, Feb 18, 2022 at 3.30pm.

PHOTO: Seedly

This will also be the first time Minister Wong will be presenting the budget statement in Parliament as Singapore’s Finance Minister, having taken over the role from Deputy Prime Minister Heng Swee Keat back in April last year.

What is the Singapore Budget 2022?

As mentioned above, this year’s budget will cover the revised Government revenue and expenditure for FY2021 and Government revenue and expenditure for FY2022.

Who makes the law and approves Singapore’s Budget?

For the FY2022 budget, the primary entity responsible is, of course, the Ministry of Finance (MOF), Singapore.

The budget will then have to be approved by Singapore’s Cabinet Parliament and finally the incumbent President of Singapore, i.e. Madam Halimah Yacob.

You can check out the breakdown of this whole process below:

Where does Singapore get its revenue?

PHOTO: Ministry of Finance

Like many Governments around the world, Singapore’s Government gets its revenue from taxes like:

  • Income taxes
  • Statutory boards’ contributions
  • Property tax (E.g. stamp duty )
  • Customs, excise and carbon taxes
  • GST
  • Betting taxes
  • Water conservation tax.

ALSO READ: Budget 2022: Singaporeans to get help with cost of living, more Covid-19 support

In addition, the Government gets revenue from fees and charges like:

  • Licenses and permits (e.g. environment, housing and properties, commerce etc.)
  • Service fees (e.g. fire and police service fees, professional services fees etc.)
  • Sales of goods (publications, commercial goods etc.
  • Rental income
  • Fines and forfeitures
  • Reimbursements.

In addition, Singapore’s annual budget is supplanted by the Net Investment Returns Contribution (NIRC).

According to MOF, NIRC comprises:

  • Up to 50per cent of the Net Investment Returns (NIR) on the net assets invested by the Government of Singapore Investment Corporation (GIC) , Temasek and the Monetary Authority of Singapore (MAS)
  • Up to 50per cent of the Net Investment Income (NII) is derived from past reserves from the remaining assets.

The annual NIRC amount is published in each year’s Government Budget.

If you are interested, you can find a full breakdown of FY2021’s revenue and expenditure numbers here.

Which ministry has the highest budget?

Well enough about revenue.

You might be wondering which ministry has the highest budget.

Well, the answer is straightforward if you look at the Singapore Government’s projected expenditure for FY2021.

PHOTO: Ministry of Finance

The Ministry of Health has the highest budget as its expenditure is the highest.

What does Singapore spend most on?

As mentioned above, Singapore spends the most on healthcare, with the Singapore Government allocating 18.4 per cent of its total expenditure to healthcare:

How to watch Singapore Budget 2022

PHOTO: Ministry of Finance

Now that you’ve learnt a bit more about Budget 2022, here is how you can catch the 2022 Budget Statement.

On Friday, Feb 18, 2022 at 3.30pm, Minister Wong will deliver the Budget Statement in Parliament. This will be broadcasted on live television radio and streamed on the Singapore Budget website.

This article was first published in Seedly.