Under the Wage Credit Scheme (WCS), more than S$600 million in payouts will be given to employers in Singapore by Tuesday (31 March) as announced by the Ministry of Finance (MOF) and Inland Revenue Authority of Singapore (IRAS) on Tuesday (17 March).
Alongside the Small Medium Enterprises (SMEs) who are the primary recipient of the payouts (with 70 per cent of the total sum disbursed), more than 90,000 employers will also receive the payouts.
With the WCS this month, qualifying wage increases will be co-funded by the government for more than 700,000 Singaporean workers earning a gross monthly wage of up to S$4,000.
These employees will have their qualifying wage increases offset in 2019, 2018 and 2017 with the March payouts.
Budget 2020 contained the provision that the gross monthly wage limit will be increased from S$4,000 to S$5,000 for qualifying pay increases in 2019 and 2020.
In addition, government co-funding levels will also be increased from the present 15 per cent and 10 per cent for 2019 and 2020, to 20 per cent and 15 per cent each respectively.
A supplementary payout will be given in the second half of 2020 to employers who are eligible for the Budget 2020 enhancements for 2019 increases in wage.
There is no need for employers to apply to receive the WCS payouts. Instead, IRAS will send letters to eligible employers by 31 March to notify them of the amount they will receive this month.
Through GIRO or PayNow Corporate services, the money will be transferred to the employers’ registered bank account.
The authorities stated that “In line with Singapore’s Smart Nation efforts, IRAS will fully adopt digital payment modes for WCS payouts, and will no longer issue cheques.”
By 30 June, appeals concerning WCS payouts must be sent to IRAS, after which they will be considered on a case-by-case basis.
The WCS enhancements are a component of the S$4 billion Stabilisation and Support Package introduced in Budget 2020 in order to aid businesses and workers impacted by the virus outbreak.
On Wednesday (12 March), the World Health Organization (WHO) officially declared the spread of Covid-19 as a global pandemic, and the impact from the virus on the global economy has deteriorated since the Budget introduction.
According to Deputy Prime Minister Heng Swee Keat last week, a second stimulus package is in the works by the government.
Based on official data released on Tuesday (17 March), non-oil domestic exports (Nodx) dropped 4.8 per cent on the basis of a seasonally adjusted month-on-month comparison in February due to the contraction in total trade by 8.6 per cent over the month.
Manpower Ministry remarked that “given the economic uncertainty arising from the COVID-19 situation” the National Wages Council (NWG) will convene on Tuesday to discuss annual guidelines on employment and wage-related matters.