ANALYSIS 1: NATIONAL BUDGET
Singapore’s Budget 2021 will highlight the country’s economic direction during an important year of recovery
Technology and workforce are top of mind for Singapore’s budget watchers The Big Four accounting firms weigh in on Singapore’s policy and financial direction, ahead of the Budget 2021 unveiling in the middle of this quarter.
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n February 16, after this issue of Singapore Business Review has gone to print, Deputy Prime Minister, Coordinating Minister for Economic Policies, and Minister for Finance Heng Swee Keat, will deliver Singapore’s FY2021 Budget Statement to the Parliament. This will be considered an important framework on the steps Singapore will take as it tackles an optimistic new year, after the height of the COVID-19 pandemic that greatly challenged every nation. According to Soh Pui Ming, EY’s Head of Tax in Singapore, with the worst of the pandemic behind, there is now a need to focus on supporting businesses to help them strengthen and transform for the future. This should be done while also ensuring that the most impacted individuals and households are given their own help to rebuild their 34
SINGAPORE BUSINESS REVIEW | MARCH 2021
lives and livelihoods. That is a common suggestion from each of the Big Four accounting firms, in each of their annual previews of the Budget. Transformation through tech KPMG is also looking for Singapore to maintain a key focus on transformation throughout the year ahead. According to partner and head of tax at KPMG Ajay Kumar Sanganeria, the innovation of 5G will be the key driver, especially for data consumption. It will also create demand for innovation in the development of technological platforms. “There is a need for more government support to enable faster 5G development and adoption on a larger scale, thus we propose tax depreciation for spectrum rights payments to offset
Transformation of industries to accommodate digitalisation will be an integral part of Singapore’s adoption 5G technology
costs to telcos. If left unaddressed, such costs may potentially be priced into products and services for consumers,” said Sanganeria. He proposed that Singapore set up a 5G technology and innovation fund, to provide grants of up to 50% of expenditure for prototyping and innovation of 5G-enabled solutions. He also suggested extending the existing Market Readiness Assistance grant to provide funding for enterprises exploring solutions in 5G-ready markets. Also integral to a 5G-ready nation, will be the transformation of industries to accommodate digitalisation. PwC has noted that local startup enterprises will have to incur additional expenditure (spanning from hardware infrastructure costs to labour costs of digitising data, information migration and staff
