Whether you care to admit it or not, Covid-19 is wreaking havoc globally. Even if you think that medically it's "just a flu" - scoffs - you can't possibly be blind to the economic implications of the coronavirus outbreak. Businesses are struggling to stay afloat, and many people are taking pay cuts, or worse, losing their jobs.
In light of this, the government has released a second stimulus package to keep Singapore going.
Note: Since the Resilience Budget 2020, there has been 1 more Solidarity Budget 2020 announcement. This article reflects the updated information.
Resilience Budget 2020 to combat Covid-19
Yesterday (Mar 26, 2020), Finance Minister Heng Swee Keat made the supplementary Resilience Budget 2020 speech, announcing more measures (including enhancements to previously-announced ones) to support everyone - especially individuals and businesses heavily hit by Covid-19.
Here's a summary of the key updates from the $48-billion Resilience Budget 2020.
- For households
- Increase in GST Voucher payouts
- Freeze on government fees and charges
- Enhanced grants for self-help groups
- For those whose jobs are affected
- Enhanced Jobs Support Scheme
- Enhanced Workfare Special Payment
- SEPs Income Relief Scheme
- Covid-19 Support grant
- For businesses
- Tax rebates and deferments
- Sector-based support
Covid-19 Budget 2020 - for households:
Let's start off with the announced support for just people in general.
1. Increase in Care and Support cash payouts previously announced in Budget 2020
Perhaps the most welcome news of the entire speech, Mr Heng said that the already-generous Care and Support cash payout announced in Budget 2020 will be further enhanced.
Singaporeans will now receive $300, $600 and $900 instead of the previous $100, $200 and $300.
The amount you will receive depends on your income and home ownership. The extra payout for parents and low-income households were also increased:
- Parents will now receive $300 instead of $100
- $100 PAssion card top-up for elderly will now be in cash
- Adult Singaporeans living in 1- and 2-room HDB flats will receive $300 instead of $100 in grocery vouchers this year
Mr Heng announced during his Solidarity Budget speech that the Care and Support Package cash payouts will be brought forward. The first $300 will be paid together with the Solidarity Payment in April 2020. The rest will be paid in June instead of August 2020.
2. Freeze on government fees and charges
Since the people are tight on cash, the government has also decided to freeze all government fees and charges for 1 year (Apr 1, 2020 to Mar 31, 2021).
This includes university or polytechnic loans (repayment and interest charges suspended from 1 Jun 2020, for 1 year) and late payment charges for HDB mortgages (suspended for 3 months).
People are always saying how HDB is much more lenient than private banks… now you know why lah.
3. Enhanced grants for self-help groups and CDCs
Self-help groups will also receive more support in the form of $20 million over 2 years. The same goes for community development councils, which will get $75 million.
Covid-19 Budget 2020 - for those whose jobs are affected:
Specifically for those whose jobs are on the line or already lost, there's additional support.
1. Enhanced Jobs Support Scheme
The Jobs Support Scheme announced in the Unity Budget 2020 gave employers 8 per cent of their worker's wages, up to $3,600. Mr Heng announced an enhancement, bumping the co-funding to 25 per cent and increasing the wage cap to $4,600 instead.
Additionally, the scheme will be extended till end-2020.
Update: as announced in the Solidarity Budget 2020, co-funding under the Jobs Support Scheme has been increased to 75 per cent for all sectors.
2. Workfare Special Payment increased to $3,000
Budget 2020 announced a special payout for those under the Workfare Income Supplement Scheme (WIS), which gave this group +20 per cent of their 2019 payout (min. $100).
The government has increased this to a $3,000 payment, to be received over 2 payments of $1,500 each.
3. SEP Income Relief Scheme (SIRS): $1,000 monthly payout for the self-employed (up to 9 months)
Even if you're not self-employed, you would have probably read about how these people are bleeding money left, right and centre. To help them, the government announced the Self-Employed Person Income Relief Scheme (SIRS), which gives eligible self-employed persons (SEPs) $1,000 monthly for 9 months.
There's $1.2 billion set aside for this, and details regarding eligibility will be released by the Ministry of Manpower soon.
4. $800 monthly payout for those who lose their jobs (up to 3 months)
Called the Covid-19 Support Grant, the government will give $800 monthly to those who lost their jobs due to the outbreak. The eligibility criteria are as follows:
- Singapore citizens or PR, age 16 and up
- Unemployed / retrenched due to Covid-19
- (Prior to unemployment) Household income not more than $10,000 monthly
- OR per capita household income not more than $3,100 monthly
- Living in property of annual value not more than $21,000
- Must not be receiving ComCare Short-to-Medium Term Assistance (SMTA) or ComCare Interim Assistance
You can read the full details on the official notice.
Covid-19 Budget 2020 - for businesses that are affected:
Lastly, Mr Heng announced quite a few measure to help businesses tide through this tough period.
1. Tax rebates and deferments to ease cash flow
There will be an automatic deferment of income tax payments for companies (and self-employed persons) for 3 months. The deferment for companies is for income tax payments due in April, May and June 2020, so businesses will only need to pay from July 2020 onwards.
The deferment for self-employed persons is for income tax payments due in May, June and July 2020. They will only need to pay from August 2020.
The property tax rebates for 2020 were also enhanced to 100 per cent for qualifying commercial properties (like hotels, serviced apartments, and more), 60 per cent for integrated resorts and 30 per cent for other non-residential properties.
Hawkers will receive 3 months of rental waivers, commercial tenants in government properties will receive 2 months of rental waivers, while other non-residential tenants in government properties will receive 0.5 1 month of rental waivers.
These measures are to free up cash for urgent use.
2. Extra support for most heavily hit sectors:
Mr Heng also announced sector-based support for aviation, tourism, land transport and arts & culture.
- Aviation - Enhanced Jobs Support Scheme (see above) with 75 per cent instead of 25 per cent wage offset + $350mil cost relief for the sector
- Tourism - Enhanced Jobs Support Scheme (see above) with 75 per cent instead of 25 per cent wage offset + $90mil for tourism recovery
- Land transport - Point-to-Point Support Package enhancement to hand out $300 per vehicle per month until Sep 2020 + 1-year road tax rebate and 6-months parking charge waiver for private bus owners
- Arts & culture - $55mil support package for major companies and arts groups and to enhance NAC's Capability Development Scheme for the Arts
Of course, while I've highlighted the above-mentioned updates as highlights of the speech, there was a lot more announced. You may read the entire announcement here on the official Singapore Budget site.
… Now, where are those people who like to complain that we "get chicken wing, give back whole chicken"? Happily calculating their GST Voucher payouts, I expect.
For the latest updates on the coronavirus, visit here.
This article was first published in MoneySmart.