The Government should hold back on any further increases in foreign worker levies, the Singapore Business Federation said on Wednesday (Jan 7).
Levies for S Pass holders – mid-level skilled foreigners – should also be removed, the federation said in a report presented to the Government last week listing its recommendations for Budget 2015. The report focused on ways small and medium-sized enterprises (SMEs) can be helped in the coming Budget.
Business costs remain high on the list of concerns faced by companies, and levies have artificially inflated costs for many players, the federation said in its report. Since S Pass holders are already subject to dependency ratio ceilings and minimum salary requirements, employers should not have to pay levies for hiring them, it said.
The federation also called for the setting up of a single authority to drive the development of SMEs into globally competitive players.
It also urged the Government to extend the Productivity and Innovation Credit (PIC) Bonus for another three years to 2018, to coincide with the extension of the PIC scheme. The Wage Credit Scheme should also be extended for another three years for SMEs, it said.
According to the Inland Revenue Authority of Singapore's website, businesses that invest in qualifying activities under the PIC scheme for Years of Assessment (YAs) 2013 to 2015 will receive a PIC Bonus. The PIC Bonus helps businesses defray rising operating costs such as wages and rentals and encourages businesses to undertake improvements in productivity and innovation.
The Government needs to prioritise SMEs to ensure that they remain central to Singapore’s economy, the federation added.