Press release

16 Feb 2024 Singapore, SG

EY reactions to Singapore Budget 2024

EY today released its reactions to the Singapore Budget 2024, titled “Building Our Shared Future Together

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EY today released its reactions to the Singapore Budget 2024, titled “Building Our Shared Future Together”.

Mr. Liew Nam Soon, Singapore Country Managing Partner and EY Asean Regional Managing Partner, Ernst & Young Solutions LLP says:

“Budget 2024 is thoughtfully calibrated, incisive and inclusive, drawing from the pillars of Forward Singapore. The measures alleviate immediate business pressures while levelling up Singapore’s long-term competitiveness through investments in sustainability and AI as levers for growth and transformation. A strong social compact is essential to enduring the winds of change. At the core of this year’s Budget is an utmost care for people – from upskilling workforce, enhancing livelihoods and improving quality of life.”

Ms. Soh Pui Ming, Singapore Head of Tax, Ernst & Young Solutions LLP says:

“Budget 2024 sends a strong signal of confidence that Singaporeans are important in our shared future.

“The refreshing of Singapore’s investment promotion toolkits gives the much-needed reassurance to multinational enterprises in this highly uncertain BEPS 2.0 global environment. As we face intensifying competition for investments, Singapore’s bold response is timely. The S$7b infusion into our investment promotion and capability development funds stands as a significant action that is testament to our resolve in uncertain times.

“The relevance of workforce continues to be a key theme in the Budget, with the SkillsFuture Level-Up Programme and enhancements in SkillsFuture Enterprise Credit catalysing the nation’s ambition to transform our workforce to be future-ready.”

Supporting businesses and driving growth

Mr. Chai Wai Fook, Partner, Tax Services, Ernst & Young Solutions LLP says: 

“As Singapore navigates the increasingly complex and inflationary environment, the Government continues to support businesses with enhancements to the Enterprise Support Package. The tax breaks provided under the Enterprise Support Package would come in handy for SMEs. They could save up to S$40,000 from the 50% corporate income tax rebate for the Year of Assessment 2024. For the enterprises that are non-profitable and employed at least one local employee in 2023, the minimum monetary support of S$2,000 provided by the Government could offer some respite.”

Mr. Chai Wai Fook, Partner, Tax Services, Ernst & Young Solutions LLP says: 

“We expect the Refundable Investment Credit (RIC) to be a critical enabler in helping Singapore to attract investments from global companies, including R&D activities, thereby anchoring high-value activities and capabilities. This will complement existing R&D and innovation pillars and propel Singapore’s ambition as a global R&D hub. At the same time, the new tax credit will spur investments by businesses in high value and substantive economic activities such as new productive capacity in manufacturing plants, expanding or establishing the scope of activities in digital services and establishing headquarter activities in Singapore.

Mr. Chai Wai Fook, Partner, Tax Services, Ernst & Young Solutions LLP says: 

“Small and medium enterprises (SMEs) play a key role in the global supply chain and can have considerable influence over emissions across their value chains. The enhanced support for green loans will help to further encourage SMEs to embrace the sustainability agenda and invest in green transition.”

Mr. Chai Wai Fook, Partner, Tax Services, Ernst & Young Solutions LLP says:

“As Singapore navigates the global climate change challenges, the expansion of support through the Enterprise Financing Scheme will bolster confidence among local enterprises, enable mindset shifts and accelerate their adoption of sustainable and green business practices.”

Mr. Praveen Tekchandani, Singapore Climate Change and Sustainability Services Leader at Ernst & Young LLP says:

"Singapore has committed to tackling the enormity and complexity of decarbonizing its energy supply by taking decisive action and adopting a multi-pronged approach. The proposed S$5b Future Energy Fund supports businesses in adopting transformative technologies like hydrogen and ammonia, alongside the continued development of low-carbon energy sources. Together, these initiatives pave the way towards a cleaner, more resilient energy future for Singapore.”

Mr. Desmond Teo, EY Asean Private Tax Leader says:

“The S$2b top up of the Financial Sector Development Fund (FSDF) will triple Singapore’s current war chest to develop talent, encourage technology and innovation and boost financial sector activities as Singapore rises to the intensifying challenge from other international financial centres. The financial sector’s growth will in turn generate positive spin-offs that support other industries.”

Mr. Ritin Mathur, Partner, Consulting, Ernst & Young Advisory Pte. Ltd. says:

“Graphic processing unit (GPU) is instrumental in the training and running of artificial intelligence (AI) and generative AI (Gen AI) technology. Singapore’s commitment to secure access to GPU shows a solid understanding of the vital components required for AI technologies.

“Furthermore, the collaboration with leading companies to establish AI Centres of Excellence will foster an environment that supports innovation, attracts international expertise and cultivates partnerships to build a robust AI ecosystem. This substantial investment of S$1b over five years, together with the extension and increase of SkillsFuture grants, will accelerate the upskilling of local talent to achieve the vision of National AI Strategy 2.0.”

Moving ahead with the BEPS 2.0 initiative

Mr. Johanes Candra, Partner, Business Incentives Advisory, Ernst & Young Solutions LLP says:

“The launch of the RIC scheme is a positive and timely move that aligns Singapore with the shifting global tax environment. It is critical for Singapore to maintain a competitive edge and continue to appeal to multinational corporations. The success of the RIC scheme as an investment promotion tool will largely depend on its flexibility in accommodating different business models and projects within the scope of qualifying expenditure.”

Mr. James Choo, Partner, International Tax and Transaction Services, Ernst & Young Solutions LLP says:

“As companies grapple with the newly introduced global minimum corporate tax regime, Singapore’s introduction of RIC will sharpen its appeal for investments, business and jobs on the global frontier. The RIC will also help Singapore move up the value chain and stay relevant, increase innovation and productivity, and progress in green transition.”

Mr. James Choo, Partner, International Tax and Transaction Services, Ernst & Young Solutions LLP says:

"The announcement that the Income Inclusion Rule and Domestic Top-up Tax will be introduced from 2025 as planned, as well as a clear confirmation that the Under-Taxed Profit Rule will not be introduced currently, provides welcome certainty for affected multinational enterprises to plan their overall business strategies."

Investing in our people

Mr. Samir Bedi, EY Asean People Consulting Leader says:

“SMEs will need to continue their business and workforce transformation efforts as they navigate economic challenges and geopolitical volatility. The extension of the SkillsFuture Enterprise Credit by a year will allow SMEs more time to embark on and complete these efforts with confidence.”

Mr. Goh Jia Yong, Partner, People Consulting, Ernst & Young Advisory Pte. Ltd. says:

“Amidst changing industry and global trends, Singaporeans aged 40 and above will look forward to the support from the SkillsFuture Level-Up Programme to embark on upskilling and reskilling efforts mid-career, and gain new skills to stay relevant.”

Mr. Goh Jia Yong, Partner, People Consulting, Ernst & Young Advisory Pte. Ltd. says:

“While we await the details of the Temporary Financial Scheme for displaced workers, Singaporeans will be heartened to know that support is forthcoming to help them update their skills and take on new employment opportunities.”

Supporting Singaporeans

Mr. Panneer Selvam, EY Asean People Advisory Services Tax Leader says:

“The S$1.9b boost to the Assurance Package, with its mix of cash, vouchers and rebates, displays the government’s clear support for the lower- and middle-income, and multigenerational households to manage the rising cost of living and uncertain economic outlook. While temporary, these measures ultimately strive to foster collective progress for all Singaporeans, strengthening Singapore’s social compact and ensuring that no one is left behind.”

Mr. Panneer Selvam, EY Asean People Advisory Services Tax Leader says:

“The adjustment in Local Qualifying Salary to S$1,600 will impact companies’ operating costs and access to foreign manpower. It is heartening to see that the government recognizes the pressures that companies will face and provides transitional support through the enhanced Progressive Wage Credit Scheme to co-fund the wage increases.

“To ensure sustainable wage growth, companies and employees should continue to focus on upskilling through the generous subsidies and training programs extended by the government in this year’s Budget.”

Mr. Panneer Selvam, EY Asean People Advisory Services Tax Leader says:

“The SkillsFuture Level-Up credit, ITE Progression Awards and ComLink+ benefits are testament that the government is committed to ensure that Singaporeans at different phases of their lives are able to collectively advance towards a society that recognises inclusivity, fairness and equality in our community.”

Mr. Panneer Selvam, EY Asean People Advisory Services Tax Leader says:

“In the spirit of giving and graciousness, tax reliefs for contributions made to overseas humanitarian aid will now be available for Singapore donors. The generosity of tax deductions to support humanitarian aid globally reflects the society’s inherent compassion and response to vulnerable individuals in a time of crisis.”

Mr. Desmond Teo, EY Asean Private Tax Leader says:

“The introduction of the Overseas Humanitarian Assistance Tax Deduction Scheme (OHAS)  expands the scope for rendering charitable efforts beyond Singapore’s shores. Following the Philanthropy Tax Incentive Scheme announced in 2023, the OHAS offers a similar 100% tax deduction on cash donations towards overseas emergency humanitarian assistance, recognising the need for help to deal with global geopolitical uncertainty and natural disasters.  The new incentive will provide further support to Singapore’s efforts in becoming a regional philanthropy hub and encourage the adoption of a regional mindset in giving back to society.”

Supporting families

Mr. Yeo Kai Eng, EY Asean Indirect Tax Leader says:

“The Assurance Package was introduced to cushion the impact of the GST rate increase for the lower income households. Thumbs up to the government by continuing to enhance the Assurance Package to help the lower income households cope with the rising cost of living in these challenging times.”

Ms. Kerrie Chang, Partner, People Advisory Services Tax, Ernst & Young Solutions LLP says:

“Ensuring a comfortable retirement for our ageing population remains a focal point in Budget 2024. This is visible in the planned 1.5% increase in CPF contribution rates for those between 55 and 65 years of age in 2025. The extension of the CPF Transition Offset further exemplifies our strategic approach by effectively managing potential business cost increases. These actions create harmony between supporting our ageing society and navigating economic shifts.”

Mr. Desmond Teo, EY Asean Private Tax Leader says:

“Singapore takes a calibrated approach in wealth-related taxation. It is notable that Singapore is prepared to refine its property tax regime to remain targeted at the top 7% of the owner-occupied residential properties and alleviate unintended tax burden on the broader population, due to the recent unanticipated rental increases.”


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