Experts suggest including tax relief in Budget, Latest Singapore News - The New Paper

Experts suggest including tax relief in Budget

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The Budget should include a one-off tax relief to help Singaporeans weather the slowing economy, said some experts.

UOB economist Francis Tan told The Straits Times the relief "could take the form of a 50 per cent income tax rebate that we saw in 2015, for example, but with a more targeted application, such as on recently retrenched workers".

The 2015 Budget included a 50 per cent personal income tax rebate for all taxpayers.

There are more than a dozen claimable tax reliefs in the system but rebates are less common.

"With slow economic growth and labour market softening, any tax savings may help boost consumption and investments," Mr Tan said.

The growth in private consumption slowed to 0.6 per cent in the third quarter last year compared with the same period in 2015, the weakest since the global financial crisis in 2009.

If last year's expansion comes in at 1.8 per cent - the official estimate - it would also be the lowest since 2009.

PwC global mobility services director Girish Naik supported moves to temporarily ease tax burdens for those suffering from a "cash crunch".

"A broad-based rebate might be difficult to implement, but it can be made applicable on specific individuals," he said.

"The relief can also come with a cap, at say $1,000, so that the measure will be of greater benefit to lower-income earners."

A tax relief cap ensures that people who earn more still pay a proportionate amount of tax.