Singapore Budget 2015 List of New Measures & Policies For Households 23 Feb 2015

Singapore 2015 Budget Logo 7 Jan 2015

Here are all the measures the Budget 2015 will be bringing for all households announced by Minister for Finance, Mr Tharman Shanmugaratnam in Parliament on 23 February 2015.

No business related benefits are listed here

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  1. (A1) Starting in the Schooling Years
  2. (A2) Taking Learning into Our Careers
  3. (B1) Higher CPF Salary Ceiling
  4. (B2) Raise CPF Contribution Rates for Older Workers
  5. (B3) Encourage Re-Employment beyond 65 years old, and Top-up to the Special Employment Credit (SEC) Fund
  6. (B4) Enhance Progressivity of the CPF System through Extra Interest
  7. (D1) Enhance Affordable, Quality Child Care ($250 million over five years)
  8. (D2) Top-up to the Child Development Account (CDA) ($126 million)
  9. (D3) Waive Exam Fees for Singaporean Students ($26 million per year)
  10. (D4) Top-up to Edusave Account ($60 million)
  11. (D5) Enhance Financial Assistance to Students ($11 million per year)
  12. (D6) Top-up to the Post-Secondary Education Account (PSEA) ($72 million)
  13. (D7) Support Self-Help Groups ($6 million)
  14. (E1) Tax Deduction for Donations ($498 million)
  15. (E2) Encourage a Culture of Giving from Young ($9 million)
  16. (E3) Extend Care & Share Movement ($250 million)
  17. (F1) Enhance GST Voucher (GSTV) Scheme ($385 million in 2015)
  18. (F2) Service and Conservancy Charges (S&CC) Rebate ($80 million)
  19. (F3) Extend and Refine Carbon Emissions-based Vehicle Scheme
  20. (F4) Raise Petrol Duty and Provide Road Tax Rebate
  21. (F5) Reduce Foreign Domestic Worker Concessionary Levy ($125 million per year)
  22. (F7) Raising the Personal Income Tax Rates

(A) Lifelong Learning – Next Phase of Development

SkillsFuture marks a major new phase of investment in our people, throughout life. Through SkillsFuture, the Government will help Singaporeans learn at every age and develop mastery and flair in every field.

SkillsFuture involves everyone: individuals and families, employers and industry associations, unions etc.

The SkillsFuture measures specific to individuals are:

(A1) Starting in the Schooling Years

To help young Singaporeans discover their interests, so that they can choose an educational path based on informed choices about the career opportunities it leads to, the Government will:

  • Develop a professional core of Education and Career Counsellors for Schools and Institutes of Higher Learning (IHLs). Career counsellors in schools and IHLs will be equipped with the industry experience and knowledge needed to provide informed guidance. Career counselling services will be scaled up at WDA for working individuals.
  • Enhance internships. Internships in IHLs will be improved to make them more structured and meaningful. More students will get international exposure, to prepare them to take on international assignments in their careers.

(A2) Taking Learning into Our Careers

The Government will invest continually in Singaporeans, throughout their careers, via the following:

  • SkillsFuture Credit. A SkillsFuture Credit will be created for all Singaporeans. Each Singaporean aged 25 years and above will receive an initial credit of $500 from 2016. This credit will be topped up at regular intervals and will not expire, but can only be used for education and training. It can be used for a broad range of courses supported by government agencies.
  • SkillsFuture Earn and Learn Programme. Fresh polytechnic and ITE graduates will be placed in jobs and receive a salary while undergoing institution-based and structured on-the-job training that leads to an industry-recognised qualification. Both trainees and employers will receive substantial support from the Government.
  • Enhanced Subsidies for Mid-Career Singaporeans. Education and training subsidises for all Singaporeans aged 40 years and above will be enhanced to a minimum of 90% of the training costs for courses funded by MOE and WDA. Singaporeans, regardless of age, will also be able to enjoy multiple subsidies from MOE for modular courses at all levels.
  • Targeted Support for Career Progression. SkillsFuture Study Awards will be given to Singaporeans seeking to develop deep specialist skills required for future growth clusters. It will be introduced in phases, starting this year, and will be awarded to about 2,000 recipients per year eventually. SkillsFuture Fellowships will also be introduced in 2016, to develop Singaporeans to achieve mastery in their respective fields. About 100 fellowships will be awarded each year. Under the SkillsFuture Leadership Development Initiative, collaborations with strategic companies will be stepped up, to develop a pipeline of Singaporeans to take on corporate leadership roles and responsibilities.

More details of these initiatives will be provided subsequently.

(B) Enhancing Central Provident Fund (CPF) Savings

(B1) Higher CPF Salary Ceiling

To help middle-income Singaporeans accumulate more CPF savings during their working years, the Government will:

  • Increase the CPF salary ceiling from $5,000 to $6,000 to keep pace with income growth over the years. This will benefit at least 544,000 members.
  • Raise the contribution cap within the Supplementary Retirement Scheme (SRS), which offers tax incentives to encourage voluntary retirement savings to complement the CPF.

These changes will take effect from 1 January 2016.

(B2) Raise CPF Contribution Rates for Older Workers

To boost the retirement adequacy of older workers, the Government will raise the CPF contribution rate for workers aged 50 to 65 years.

The increase in employer contributions will go to the Special Account, while the increase in employee contributions will go to the Ordinary Account. These changes will take effect from 1 January 2016.

Table 1: Increase in CPF Contribution Rates for Older Workers

Employee Age
(Years)
New Contribution Rates from Jan 2016 (% of wage)
(% point increases are in brackets):
EmployerEmployeeTotal
Above 50 to 5517 (+1)20 (+1)37 (+2)
Above 55 to 6013 (+1)1326 (+1)
Above 60 to 659 (+0.5)7.516.5 (+0.5)

(B3) Encourage Re-Employment beyond 65 years old, and Top-up to the Special Employment Credit (SEC) Fund

To promote voluntary re-employment of older workers, the Government will provide employers with an additional Special Employment Credit (SEC) of up to 3% of wages for workers aged 65 years and above in 2015. This is on top of the 8.5% wage offset that employers would receive in 2015. This will cost about $50 million.

The Government will top up the SEC Fund by $500 million to meet the needs of the SEC until the scheme expires in 2016.

More details will be provided at the Ministry of Manpower’s Committee of Supply.

(B4) Enhance Progressivity of the CPF System through Extra Interest

To enhance the progressivity of the CPF system, the Government will raise the interest rate on the first $30,000 of CPF balances of members from the age of 55 years, by 1 % point. This will take effect from 1 January 2016.

Table 2: CPF Interest Rate Structure for Members Aged 55 Years and Above from 1 January 2016

CPF BalancesInterest Rate
First $30,0006%
Next $30,0005%
Amounts above $60,0004%

Interest Rate refers to interest rates on balances in Retirement, Special and Medisave Accounts. Balances in Ordinary Account can earn up to 4.5% for members age 55 and above.

(C) Silver Support Scheme

To support lower-income Singaporeans in their retirement years, the Government will introduce the Silver Support Scheme as a new permanent feature in the social security system. Silver Support will provide a modest but meaningful supplement of $300 to $750 every quarter for the bottom 20% of Singaporeans aged 65 years and above, with a smaller degree of support extended to cover up to 30% of seniors.

Eligibility for Silver Support will be determined through three factors in combination – lifetime wages, level of household support, and the type of housing lived in. About 150,000 of today’s elderly will benefit.

The Silver Support Scheme will be implemented around the first quarter of 2016 and will cost about $350 million in the first full year.

More details will be announced by the Ministry of Manpower closer to the implementation of the Scheme.

(D) Support for Growing Years

(D1) Enhance Affordable, Quality Child Care ($250 million over five years)

To enhance the affordability of quality child care, the Government will introduce a new Partner Operator (POP) Scheme, which will complement the Anchor Operator (AOP) Scheme.

Child care operators on the POP scheme will have to commit to keeping fees affordable, developing their teachers, and enhancing quality. Through a combination of the AOP and POP schemes, about 50% of pre-school children will benefit from enhanced government support for pre-school by 2020.

More details will be announced at the Ministry for Social and Family Development’s Committee of Supply.

(D2) Top-up to the Child Development Account (CDA) ($126 million)

To help families pay for pre-school fees, the Government will provide a one-off top-up to the CDA of every Singaporean child aged six years and below in 2015:

Table 3: Top-up to the CDA

Age in 2015Annual Value (AV) of home as at 31 Dec 2014
Up to $13,000$13,001 and above
0 to 6 years$600$300

About 230,000 children will benefit.

(D3) Waive Exam Fees for Singaporean Students ($26 million per year)

To reduce out-of pocket expenses of families, the Government will:

  • Waive fees for national examinations (PSLE, GCE ‘N’, ‘O’ and ‘A’ levels) for all Singaporean students in Government-funded schools.
  • Waive examination fees for Singaporeans enrolled full-time in Institute of Technical Education (ITE) Colleges and Polytechnics.

(D4) Top-up to Edusave Account ($60 million)

The Government will provide a $150 one-off top-up to the Edusave Accounts of Singaporean students aged 7 to 16 years, on top of the annual contribution of up to $240.

Students above the age of 16 years who are still in secondary school will also receive the top-up.

About 400,000 students will benefit.

(D5) Enhance Financial Assistance to Students ($11 million per year)

The MOE Financial Assistance Scheme will be enhanced to:

  • Include a transport subsidy that will cover at least half of the students’ transport costs. This will cover public transport for all students, as well as school buses for primary students.
  • Increase the annual grants for school-based financial assistance over the next three years. This will give each School Advisory and Management Committee more resources to provide further targeted assistance to needy students.

These initiatives will also be extended to the Special Education schools, appropriately adjusted to meet their specific needs.

More details will be announced at the Ministry of Education’s Committee of Supply.

(D6) Top-up to the Post-Secondary Education Account (PSEA) ($72 million)

To assist households in saving for tertiary education, the Government will provide a one-off top-up to the PSEA of Singaporeans aged 17 to 20 years, if they do not already benefit from the Edusave top-up.

Table 4: PSEA Top-up

Age in 2015AV of Home as at 31 Dec 2014
Up to $13,000$13,001 and above
17 to 20 years$500$250

About 160,000 Singaporeans will benefit.

(D7) Support Self-Help Groups ($6 million)

The Government will provide a $6 million grant to the Self-Help Groups over the next two years to support them as they expand their programmes and outreach to help children of needy families progress in school.

(E) Fostering a Spirit of Giving

(E1) Tax Deduction for Donations ($498 million)

The tax deduction for qualifying donations made to Institutions of a Public Character (IPCs) and other qualifying recipient in 2015 will be increased from the current 250% to 300%.

The 250% tax deduction for donations will be extended, which will expire on 31 December 2015, by another three years for qualifying donations made from 1 January 2016 to 31 December 2018.

(E2) Encourage a Culture of Giving from Young ($9 million)

To encourage the spirit of giving and to raise the awareness of community causes in students from young, the Government will donate $20,000 to causes identified by each school.

This initiative will also be extended to Polytechnics and ITE, for which the Government will donate $150,000 and $250,000 respectively on behalf of each institution.

(E3) Extend Care & Share Movement ($250 million)

As recently announced, the Government will extend matching grant support for the Care & Share Movement till 31 March 2016, with an additional $250 million.

This doubles the total matching grant for Care & Share to $500 million.

(F) Other Measures Affecting Singaporean Households

(F1) Enhance GST Voucher (GSTV) Scheme ($385 million in 2015)

To help lower-income households with their cost of living, the Government will:

  • Increase the quantum for GSTV – Cash by $50 from 2015 onwards. About 1.4 million Singaporeans will benefit.

Table 5: Enhancements to GSTV – Cash

Assessable Income for YA
2014 ≤ $26,000
Annual Value of Home as at 31 Dec 2014
Up to $13,000$13,001 to $21,000
Aged 21 years and above$300
(previously $250)
$150
(previously $100)
  • Provide additional bonuses for seniors in 2015. More than 660,000 older Singaporeans will benefit.

Table 6: Additional GSTV – Seniors’ Bonus for 2015

Assessable Income for YA
2014 ≤ $26,000
Annual Value of Home as at 31 Dec 2014
Up to $13,000$13,001 to $21,000
Aged 55 to 64 years$300$150
Aged 65 years and above$600

(F2) Service and Conservancy Charges (S&CC) Rebate ($80 million)

To help households with their general household expenses, the Government will provide S&CC rebates in 2015:

Table 7: 2015 S&CC Rebate

HDB Flat TypeS&CC Rebate (months)
1 and 2-room3
3 and 4-room2
5-room1.5
Executive1

(F3) Extend and Refine Carbon Emissions-based Vehicle Scheme

The Carbon Emissions-based Vehicle Scheme will be extended to 30 June 2017 with refinements to encourage a further shift to greener cars.

More details will be announced at the Ministry of Transport’s Committee of Supply.

(F4) Raise Petrol Duty and Provide Road Tax Rebate

To encourage lower car usage and reduce carbon emissions, the petrol duty rates for premium grade petrol and intermediate grade petrol will be increased by $0.20 per litre and $0.15 per litre respectively. This will take effect from 23 February 2015.

To ease the transition to the revised petrol duties, the Government will provide a one-year road tax rebate of 20% for cars, 60% for motorcycles, and 100% for commercial vehicles using petrol.

(F5) Reduce Foreign Domestic Worker Concessionary Levy ($125 million per year)

To provide greater support for middle-income families who are taking care of their children and elderly parents, the Government will:

  • Reduce the foreign domestic worker concessionary levy from $120 per month to $60 per month.
  • Extend the concessionary levy to households with a child aged below 16 years, up from below 12 years today.

This will take effect from 1 May 2015. About 144,500 households will benefit. (F6) Personal Income Tax Rebate

To help middle-income taxpayers, the Government will provide a Personal Income Tax rebate of 50% capped at $1,000 for Year of Assessment 2015 (i.e. for income earned in 2014). About 1.5 million tax-resident individuals will benefit from the tax rebate.

(F7) Raising the Personal Income Tax Rates

To enhance progressivity of the Personal Income Tax Rate structure and to strengthen future revenues, the tax rates for tax-resident individuals will be revised as follows:

Table 8: Changes to Personal Income Tax Rates (Effective YA 2017)

Chargeable Income ($)Current Tax Rate (%)New Tax Rate (%)
0 – 20,0000No change
>20,000 – 30,0002
>30,000 – 40,0003.5
>40,000 – 80,0007
>80,000 – 120,00011.5
>120,000 – 160,00015
>160,000 – 200,0001718
>200,000 – 240,0001819
>240,000 – 280,00019.5
>280,000 – 320,00020
Above 320,0002022

The changes will take effect from Year of Assessment 2017 (i.e. on income earned in 2016).

Visit www.singaporebudget.gov.sg for more information.

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