Budget 2016 is an expansionary fiscal budget for Singapore. Total government expenditure for 2016 will be raised by 7.3% from 2015 to $73.4 billion.
$73.4 billion would be spent on the economy by the government. This translates into Gross Domestic Product (GDP) in the new fiscal year.
This is the broad picture.
One particular expenditure that will happen this time round is payment to seniors in the Silver Support Scheme. The total amount to be given out is $320 million. It is hoped that this cash payout is spent by entitled seniors instead of being saved. This way the multiplier effect of spending can be translated into economic growth.
The other major government spending on people is the One-off GST cash voucher amounting to $280 million to eligible recipients. Both Silver Support payout and One-off GST vouchers amount to total $600 million. Both happening this year.
There are government expenditures that will help the economy and they are old schemes already in existence, like:
- Workfare Income Supplement Scheme ($770 million)
- Corporate income tax rebates ($180 million over two years)
- Special Employment Credit ($1.1 billion for 3 years to end 2019)
Going back to macro picture, 7.3% increase in government expenditure in 2016 may not seem enough if our Export part of the economy continues to decline. That is the major risk factor when the global economy is uncertain.
At this moment, I am not 100% confident with the Singapore economy in 2016.
Copyright © 2016, limkimtong for Living Investment
The material presented is intended to be general and written in layman’s language as much as it is possible. The author shall not be liable for any direct or consequential loss arising from any use of material written. Please seek professional advice from your financial advisor or financial institutions on material written covering financial matters.