Economic growth fell well below expectations

Budget for FY2009 Key Budget Initiatives

Resilience Package totalling $20.5 billion

  • to save jobs to the maximum extent and help viable companies stay afloat
  • to prepare emerge Singapore with strength when the global economy recovers
  • to enhance capabilities and competitiveness for the long term
  • to help avert an even sharper downturn and prevent permanent damage to economy


Finance Minister Tharman Shanmugaratnam describes Singapore’s economic downturn and global conditions in introducing Budget for FY2009.



Key Budget Initiatives for businesses and households

$5.1 billion to preserve jobs

  • Jobs Credit – a 12% cash grant on first $2,500 of wages
  • Enhancing SPUR to help PMETs re-train
  • WIS Special Payment to low-income workers

$5.8 billion to stimulate bank lending

  • Bridging Loan Programme to loans of up to $5 million
  • New risk-sharing schemes for trade financing

Tax concessions and measures costing $2.6 billion to ease business cash-flow

To ease business cash-flow

  • 40% property tax rebate for industrial and commercial properties
  • Property tax deferral for land approved for development
  • Loss carry-back relief enhancements
  • Tax exemption of all foreign-sourced income earned
  • 30% road tax rebate for goods vehicles, buses and taxis
  • Waiver of Special (Diesel) Tax for unhired taxis

To strengthen competitiveness and capabilities

  • Corporate Income Tax Rate (CIT) reduction to 17%
  • Accelerated capital allowance for plant and machinery acquired
  • Accelerated write-down of renovation and refurbishment expenses
  • $200 million Test-Bedding Fund
  • $400m top-up to National Research Fund

$2.6 billion additional support to Singaporean households

Direct Assistance to Households

  • Doubling of GST Credits and Senior Citizens’ Bonus
  • 20% personal income tax rebate capped at $2,000
  • 40% property tax rebate for owner-occupied residential properties
  • Additional S&CC rebates for eligible HDB households
  • Additional rental rebates for eligible households in public rental flats
  • Enhanced Additional CPF Housing Grant for first-time home buyers

Targeted Help for Vulnerable Groups

  • Increased Public Assistance rate
  • Increased Singapore Allowance for government pensioners
  • $100m top-up to each of the ElderCare Fund and Medical Endowment Fund
  • Enhanced Financial Assistance Scheme and new Short-Term Study Assistance Scheme for students
  • $10m top-up to the Public Transport Fund

Support for Charitable Giving and the Community

  • Increased tax deduction for donations madeto Institutions of Public Character and other approved institutions to 250%
  • Additional $15m to Government-funded Voluntary Welfare Organisations (VWOs)
  • Increased funding of $4m to self-help groups over two years
  • Increased funding to $7m to the CCC Comcare Fund for the next two years

$4.4 billion construction projects in four areas

  • $1.3 billion of infrastructure projects to be brought forward to 2009
  • $1 billion funding for sustainable development programmes over five years
  • Development of suburban nodes, road and rail networks, drainage and sewerage networks, and public housing estate rejuvenation
  • Upgrade of education and health infrastructure

Budget Position

  • To draw $4.9 billion from past reserves to fund Jobs Credit and the Special Risk-Sharing Initiative.
  • $8.7 billion deficit for revised Overall FY2009 Budget Balance, 3.5% of GDP.

(The Basic Balance, which excludes transfers to endowment funds and contributions from Net Investment Returns, is a deficit of $14.9 billion or 6.0% of GDP.)


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