Temporary Bridge Loan, Enhanced Business Finance Programs for SMEs Extended to March 2022, Politics News & Top Stories
SINGAPORE – Small and medium-sized enterprises can continue to access credit to build their capacity through the expansion of two programs, Finance Minister Lawrence Wong told parliament on Monday (July 5th).
The Temporary Bridge Loan Program and Enhanced Business Finance Program – Commercial Loan will be extended for an additional six months from October 1 of this year to March 31, 2022.
“For many SMEs, access to credit is an essential lifeline to get them out of this crisis … Although economic conditions have improved, this access to credit remains essential for our SMEs,” said Mr. Wong in a ministerial statement on support measures for businesses and workers affected by the latest measures related to Covid-19.
The Temporary Bridge Loan Program aims to help local businesses manage their immediate cash flow needs, while the Enhanced Corporate Finance Program – Commercial Loan covers the business needs of businesses in areas such as inventory and finance financing. stocks.
The government has supported more than $ 22 billion in loans to more than 25,000 businesses through Enterprise Singapore’s financing programs since the start of last year, Wong said, adding that 99% of recipients were SMEs.
The parameters of both regimes remain unchanged, including the government’s 70 percent risk share.
The Monetary Authority of Singapore (MAS) will also accordingly extend the MAS Singapore Dollar Facility for Singapore Business Lending, which provides low-cost financing for banks and finance companies to provide ESG-supervised loans.
“I encourage businesses to use this extension and other available programs to prepare for the new normal. Many of our SMEs have already taken the opportunity to develop new capabilities and make their businesses sustainable,” said Mr. Wong.
He cited the example of the restaurant company Slake, which started in 2014 as a neighborhood bistro in Siglap.
The company took the lead online in 2017 by accepting the Productivity Solutions grant that helps businesses adopt IT solutions and equipment to improve business processes.
The company’s investments paid off during last year’s breaker, Wong said.
âSince then, Slake has redoubled its efforts to go digital. They accepted the Business Development Grant to develop a virtual brand for new revenue streams, used the Food Delivery Booster Package, and they recently also extended their social media marketing.
He added, âThe way we have provided support during this cycle, as well as our ongoing support programs over the years, reflects our tax approach to supporting Singaporeans and businesses in Singapore. “
The government ensured a fair tax system for all even before the pandemic, he said.
Aggregate income tax receipts – both corporate and personal – as a percentage of gross domestic product are about 6 percent, or about half of the Organization’s 12 percent average. economic cooperation and development, he added.
âFor individuals, we operate a phased transfer system that provides more help to those who need it mostâ¦â he said.
Mr. Wong said Singapore has a competitive tax regime for businesses, especially SMEs, as they are the backbone of the economy.
He added that a global movement to change corporate tax rules would only affect a select group of global businesses, not small businesses. “So our SMEs in Singapore can continue to benefit from low taxes.”
Singaporean SMEs – or those with turnover of $ 100 million – make up more than 95% of businesses operating in Singapore, but they contribute less than a third of the country’s corporate tax revenue.
More than half of these businesses do not pay corporate tax.
Besides taxes, the government recognizes that SMEs are concerned with business costs such as rental, labor and utilities, Wong said.
âWe don’t directly offset these costs under normal circumstances, but rather offer a wide range of programs to help them improve their productivity and develop new capabilities. “
About 70 percent of government business grant disbursements from 2015 to 2019 went to SMEs.
âIn times of crisis, we recognize that low-income households and SMEs face greater challenges, and that is why we have designed our interventions to benefit them the most,â Wong said.
About two-thirds of the $ 26.7 billion paid to date under the employment support program has gone to SMEs, as has 90% of the benefits of the corporate income tax abatement. of the assessment year 2020.