This article was updated on 19 November 2024 to include further enhancements to the MediSave Bonus announced in October 2024.
On 16 February 2024, Deputy Prime Minister and Finance Minister Lawrence Wong presented the Singapore Budget 2024 in parliament.
He started by painting a grim economic outlook for 2024 – citing the troubled geopolitical environment, muted global economy and modest 1.1% growth. Beyond this, household are also feeling the pinch from spiralling cost of living.
We summarise 24 things from the Singapore Budget 2024 that will have the biggest impacts Singaporeans.
#1 Additional $600 CDC Vouchers For All Singaporean Households
All Singaporean households will receive an additional $600 in CDC Vouchers from the Singapore Budget 2024. We will receive $300 in end-June 2024, and the remaining $300 in January 2025.
This is on top of the $500 in CDC Vouchers Singaporean households aleady received in January 2024. Typically, half of the value of each disbursement are allocated to participating heartland merchants and hawkers, and at participating supermarkets.
#2 Cost-of-Living Special Payment Of $200 To $400
All adult Singaporeans with Assessable Income of up to $100,000, and do not own more than one property, will get a Cost-of-Living (COL) Special payment between $200 and $400.
Read Also: How Much Will You Get From The Sep 2023 $1.1 Billion Cost-Of-Living Support Package
#3 Additional U-Save Rebates S&CC Rebates For HDB Households
HDB households can expect to receive up to $950 in U-Save rebates in FY2024. This will cover about 4 months’ worth of utility bills for 3- and 4-room HDB flats.
HDB households will also get an additional one-off Service &Conservancy Charges (S&CC) rebate in FY2024. this will take their total S&CC rebates to up to 4 months in FY2024.
#4 SkillsFuture Level-Up Programme: $4,000 SkillsFuture Credit Top-Up
All Singaporean aged 40 and above will get a $4,000 SkillsFuture Credit top-up. Future cohorts – younger than 40 years old today – will also receive this top-up once they turn 40.
This top-up will be more targeted compared to the existing $500 basic tier of SkillsFuture Credits – which allow for a wide range of courses.
Instead, the $4,000 will be confined to use in selected full-time, part-time and undergraduate programmes, as well as for courses under the Progressive Wage Model sectors.
#5 Subsidies For A Full-Time Diploma
For more comprehensive upskilling support, Singaporeans aged 40 and above will also receive subsidies to pursue another full-time diploma at Polytechnics, ITE, and Arts Institutions from Academic Year 2025 onwards.
This gives every Singaporean another bite of the education subsidy after they turn 40.
#6 Monthly Training Allowance Of 50% Of Your Income When You Enrol In Full Time Course
On top of the subsidy, those who enrol in selected full-time courses will also receive a training allowance equivalent to 50% of their average annual income. This is capped at $3,000 per month.
Every individual can receive up to 24 months of training allowance throughout their lifetime. This will support Singaporeans over the full duration of a SkillsFuture Career Transition Programme.
#7 Temporary Financial Support Scheme For Retrenched Workers
A temporary financial support scheme will be introduced for workers who become involuntarily unemployed.
This will support them and their families as they bounce back. Ideally, this will alleviate the pressures of rushing into the first available job they find, and help them consider their next move.
The Government will be designing this scheme carefully, with regards to the amount and conditionalities, to avoid the pitfalls other countries encounter when introducing unemployment benefits.
#8 Enhanced Workfare Income Supplement (WIS) Scheme
From 2025, the qualifying income cap for workers, aged 30 and above, to be eligible for the Workfare Income Supplement (WIS) Scheme will be raised to $3,000, from $2,500.
Lower wage senior workers can qualify for a maximum annual payout of $4,900, up from $4,200 today.
Read Also: Guide To Workfare Income Supplement Scheme And How Much Those Who Are Eligible Will Receive
#9 Local Qualifying Salary (LQS) Raised to $1,600
Companies that hire foreign employees must pay all their local employees at least the Local Qualifying Salary (LQS).
During Budget 2024, the LQS was raised to $1,600, from $1,400 previously. This also means the minimum hourly rate for local workers will be raised to $10.50 per hour, from $9 per hour.
In addition to this, DPM Lawrence Wong also mentioned that the co-funding levels under the Progressive Wage Credit Scheme (PWCS) will be raised to a maximum of 50%, from 30% previously. The salary ceiling will also be raised to $3,000 from $2,500 from 2025.
Read Also: Local Qualifying Salary: 5 Things You Need To Know About LQS
#10 ITE Progression Award
To support ITE graduates carve a better career and earn a better wage for themselves, a new ITE Progression Award was announced.
First, ITE graduates aged 30 and below will get a $5,000 top-up to their Post-Secondary Education Account (PSEA) when they enrol into a diploma programme. This should help defray the costs of obtaining their diploma.
Upon attaining their diploma, students will get a further $10,000 top-up into their CPF Ordinary Account – to give them a head-start in purchases a home or saving for retirement.
#11 ComLink+ Progress Packages
To combat inequality, additional support will be rolled out in the form of ComLink+ Progress Packages.
For example, adults in the family can receive payouts of $600 every quarter, through a combination of cash and CPF, if they secure a job and stay employed.
Those who make voluntary CPF contributions will also receive matching grants from the Government. Combined with the Fresh Start Housing Scheme, this will help vulnerable families purchase their own homes.
#12 Monthly Childcare Fee Cap reduction
In the Singapore Budget 2024, DPM Lawrence Wong reiterated the Government’s commitment to improve preschool affordability.
Full-day preschool for dual-income families will be comparable to primary school and after-school student care.
This will be done in two stages. First, by reducing monthly childcare fee caps in Government-supported preschools in 2025 to $640 for Anchor Operators and $680 for Partner Operators. This cap is before childcare subsidies that all families will benefit from. Another round of fee cap reductions will be made in 2026.
Lower income families and families with non-working mothers will also receive enhanced subsidies for preschools.
The Government will also enhance Edusave awards to support education initiatives in schools.
Families with special needs children will also receive more support. While such families already receive more subsidies than students in mainstream schools, the cost at Special Education (SPED) schools are higher. As a first step, the maximum monthly fees at SPED schools will be reduced to $90, from $150 today.
Fee caps will also be lowered at all Special Student Care Centres to reduce out-of-pocket expenses for families.
#13 PPHS (Open Market) Voucher For 1 Year To Offset Rents
HDB offers a subsidised rental housing under the Parenthood Provisional Housing Scheme (PPHS). Currently, it receives many applications from families still waiting to receive their BTO keys.
In response, a PPHS (Open Market) Voucher for one year will be provided to support eligible families who rent an HDB flat in the open market.
#14 CPF Contribution Rate For Workers Aged 55 To 65 Will Increase 1.5 Percentage Points
To boost the retirement adequacy of senior workers, the Government set out to raise CPF contribution rates for senior workers aged 55 to 70 in phases.
In 2025, the next phase will take effect, raising CPF contribution rates for those aged 55 to 65 by 1.5 percentage points.
This will bring their total CPF contribution rate to 31% (above 55 to 60) and 22% (above 60 to 65).
To offset higher CPF payments for employers, the Government will provide the CPF Transition Offset for half of the increase in Employer Contributions.
#15 CPF Enhanced Retirement Sum (ERS) Raised To 4x Of BRS
From 2025, the Enhanced Retirement Sum (ERS) will increase to 4x of the Basic Retirement Sum (BRS), instead of 3x the BRS currently.
This will raise the ERS to $426,000 in 2025, instead of $319,500. This is meant to allow seniors to fully commit their CPF savings to eventually receive higher monthly CPF LIFE payouts.
Read Also: BRS, FRS, ERS: Why There Are 3 CPF Retirement Sums & Why They Increase Every Year
#16 CPF Special Account Scrapped For Those Turning 55
Those who turn 55 get a new Retirement Account (RA). From 2025, the Retirement Account will replace the Special Account, rather than form a fourth CPF account.
Special Account savings will be transferred to the Retirement Account, up to the Full Retirement Account. The remaining sums will be transferred to the Ordinary Account.
Nevertheless, with the maximum cap (i.e. ERS) raised to $426,000 from 2025, members can voluntarily transfer their OA savings to the RA, up to the ERS, at any point.
#17 Silver Support Scheme: Qualifying Per Capita Household Income Increased To $2,300
The qualifying per capita income threshold for seniors to receive Silver Support Scheme payment will be raised to $2,300, from $1,800. The quarterly payments will also be increased by 20%, to keep pace with inflation.
This will support seniors who had low incomes during their working years to enjoy better retirement adequacy.
Read Also: Complete Guide To How Much You Can Receive From The (Enhanced) Silver Support Scheme
#18 Enhanced Matched Retirement Savings Scheme (MRSS)
The Matched Retirement Savings Scheme (MRSS) helps Singaporean aged 55 to 70 with less CPF savings save more with a dollar-for-dollar matching for cash top-ups to their CPF accounts.
First, the age cap of 70 years will be removed, allowing older Singaporeans to beef up their retirement adequacy.
The annual matching cap will also be increased to $2,000 from $600, with a lifetime cap of $20,000.
Finally, since the Government matching is a significant benefit, there will no longer be a tax relief for cash top-ups that attract the matching grant.
Read Also: Step By Step Guide To Top Up Your CPF Matched Retirement Savings Scheme (MRSS)
#19 Enhancements To The Majulah Package
An Earn and Save Bonus yearly bonus of up to $1,000 will be given to seniors earning up to $6,000 a month, as long as they work.
Seniors with retirement savings below the Basic Retirement Sum (BRS) will also receive a one-time Retirement Savings Bonus of $1,000 to $1,500.
Both bonuses are only eligible for seniors who live in a property with Annual Value of $25,000 or less, and own no more than one property.
A one-time MediSave Bonus of $1,250 or $2,000 under the Majulah Package will also be give to all seniors born in 1973 or earlier.
The entire Majulah Package payout will be set aside in a new fund, so that future generations of Singaporeans are not burdened with this promise.
Read Also: Guide To The Majulah Package: Earn & Save, Retirement Savings Bonus, And Medisave Bonus
#20 MediSave Bonus Of Up To $500 For Those 21 to 50. Up To $2,000 For Those 51 & Above
All Singaporean adults, aged 21 to 50 will get a one-time MediSave Bonus of $300 to $500. Singaporeans aged 51 and above will receive between $1,250 or $2,000 in MediSave Bonus.
In addition, the per capital income thresholds for healthcare and assisted social support subsidy schemes will also be updated. This includes for MediShidl Life premium subsidies, CHAS subsidies, and subsidies for outpatient and inpatient treatments at public hospitals.
#21 $200 LifeSG For All NSmen Past and Present
As gratitude for the service and sacrifices made by national servicemen, a small gesture of $200 in the form of LifeSG credits will be given to all NSmen – past and present.
This will cost $240 million, and benefit 1.2 million NSmen.
#22 Personal Income Tax Reduction
In light of concerns over cost of living in Singapore, there will be a Personal Income Tax Rebate of 50% for the Year of Assessment 2024. This will be capped at $200 to benefit middle-income workers.
To further support Singaporeans caring for dependants, the annual income threshold for dependant-related reliefs will be increased to $8,000, from $4,000.
Finally, the Government also recognises the importance to giving to those in need outside of Singapore. To this end, an Overseas Humanitarian Assistance Tax Deduction Scheme will be introduced. This will provide 100% tax deductions for cash donations made towards overseas emergency humanitarian assistance causes through designated charities. This pilot will run for four years.
#23 Annual Value Bracket For Property Tax Threshold
As a result of an increase in property rents after the COVID-19 pandemic, Annual Value (AV) of homes have significantly increased. Thus, to keep to the spirit of implementing a wealth tax, the AV bands of owner-occupied properties will be increased in 2025.
At the lower end, the threshold will be raised to $12,000, from $8,000. At the higher end, the threshold will be raised to over $140,000 from over $100,000.
A property tax rebate has been provided this year to cushion against the impact of the changes this year.
To help retirees living in higher-end properties, but with limited cash flow, they can apply to IRAS for a 24-month instalment plan without any interest.
#24 ABSD Remission Extended To Singles Over 55 Who Rightsize
Singles above 55 can get ABSD remission – similar to couples today – when they sell their first property within 6 months of rightsizing when they purchase a replacement property.
The post Singapore Budget 2024: 24 Things That Will Impact Singaporeans Financially appeared first on DollarsAndSense.sg.
