Singapore Budget is 'Robin Hood Tax': PwC

Is taxing the rich a smart move?

PwC released its reactions to the recently delivered Singapore Budget 2013. Here's the analysts' overall comments:

David Sandison, Partner, PwC Services LLP says: As I listened to the Budget speech, I started to get the feeling that as always these are all nice policies, but as always, I fear about the difficulty of implementation as a result of the web of options and the complexity. Will some of this be too micro for its own good and too difficult for businesses to get their minds around? This is quite apart from the fact that some of them may be seen to be somewhat controversial.

Anuj Kagalwala, Partner, PwC Services LLP says: Singapore is in a good place. It's churning out budget surpluses and offering benefits to its citizens. Not many countries are doing that.

Tan Tay Lek, Partner, PwC Services LLP says: This is the most generous tax credit announced in recent years and should significantly help firms with rising business costs. The Government should allow firms to carry forward the benefit of the tax rebate to future years when the economic outlook maybe brighter.

Lim Maan Huey, Partner, PwC Services LLP says: Several budget policies have targeted the undercurrents felt in our Singapore Conversations in terms of rising business costs, transportation woes, rising wage gaps, etc. However, the further tightening of foreign labour will no doubt take some shine away from these goodies for businesses.

Koh Soo How, Partner, PwC Services LLP says: This year’s Budget is one that is strategic as it takes aim at the structuring of the Singapore economy for long-term sustainable growth.

Past budgets have seen the government setting the foundation, and laying the bricks for Singapore’s growth. Budget 2103 sees the government pouring the cement to confirm the government’s commitment to raise overall productivity. Hopefully, the cement does not set too quickly for some businesses to fold before they achieve their productivity gains.

The tightening lid on foreign workers and increased workers levies gives companies little choice but to embrace productivity as a driver to remain competitive and achieve quality growth. At the same, there is some soothing balm in the form of the Wage Credit Scheme, PIC Bonus and the Corporate tax bonus that gives companies some help to invest and implement the programmes that would drive productivity and innovation in the business

Overall, the message is clear. Businesses need to see beyond a quick fix – whatever the pain, improving productivity remains the long term goal for Singapore.

Here is the full copy of PwC's reactions to Singapore Budget.

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