To address the adverse economic impact of the Covid-19 circuit breaker contingency measures, the Singapore government announced the Solidarity Budget on 6 April 2020. Totaling S$5.1 billion, the Solidarity Budget is the third in a series of Covid-19 financial support packages, after the Unity and Resilience Budgets.
The Solidarity Budget mainly consists of enhancements to the relief schemes announced in the Resilience Budget. With all non-essential workplaces to close from 7 April to 4 May, Deputy Prime Minister (DPM) Heng Swee Keat acknowledged that businesses across all industries will be considerably and measureably impacted. The primary purpose of the Solidarity Budget, DPM Heng said, is therefore to “save jobs and protect livelihoods” across the entire spectrum of industries in Singapore.
If you have a stake in property (like most Singaporeans do), here’s how the Solidarity Budget will make a difference:
Before we go into individuals, let’s take a look at property developers, and whether they got the ABSD extension they were hoping for.
Alas, no direct relief was announced for real estate developers even as the authorities ordered condo sales galleries to shut and all property viewings to cease during the circuit breaker period. Instead, more property agents could directly benefit under an enhanced Self-Employed Person Relief Scheme (SIRS).
But one step down the chain, contractors who hire foreign workers on work permits and ‘S’ Passes will receive help from the government. The Foreign Worker Levy will be waived for the month of April. In addition, employers will also receive a Foreign Worker Levy Rebate of $750 for each work permit or S Pass holder.
The Foreign Worker Levy Rebate will provide the construction and renovation industries some breathing space for both cost and cash flow, and encourage businesses to bounce back quickly after the one-month circuit breaker measures are lifted. Developers depend on them for the completion of their projects, so this rebate is better than nothing.
Oh, and if you’re a homeowner renovating your place, and all work is suspended during the circuit breaker measures, this rebate—together with a slew of loans and support for SMEs—might just prevent your contractor and/or ID from going bust.
For property agents
Property agents, including both full-time and part-time agents, have been hit hard by Covid-19 measures, but not every agent is eligible for the governments’ Covid-19 relief.
In the Solidarity Budget, DPM Heng Swee Keat announced the expansion of the eligibility criteria of the Self-Employed Person Income Relief Scheme (SIRS), which means more real estate agents could be eligble for financial aid.
Expanding the definition of self-employed persons:
- Previously: Those who had full-time employment, however minor, did not qualify for SIRS
- Now: Those who earn a small income from employment work can quality for SIRS, in addition to fully self-employed persons
Raising the ‘Annual Value of property’ eligibility threshold:
- Previously: $13,000
- Now: $21,000
With the higher annual value of property, self-employed persons who are residing in condominiums or other private property could now be eligible for SIRS. You can check the Annual Value for your property here.
A self-employed person eligible for SIRS will also receive 3 x $3,000 payouts, in May, July and October 2020.
Other eligibility criteria for SIRS:
- Started work as an SEP on or before 25 March 2020
- Earn a Net Trade Income of no more than $100,000
- Do not own two or more properties
How to apply for SIRS:
- Singaporean SEPs aged 37 and over in 2020 who declared positive SEP income to the Inland Revenue Authority of Singapore (IRAS)/CPF Board (CPFB) for Work Year 2018 do not need to apply. They will be automatically notified of their eligibility via letter and SMS, and will receive the first SIRS payout automatically in May 2020.
- Other eligible SEPs may apply for SIRS. More details on SIRS and the application process will be released at a later date.
For property agents, 99.co has also rolled out a Agent Resilience Package to help them tide though the period.
For tenants of commercial property
In the Resilience Budget on 26 March 2020, the government announced a Property Tax Rebate of up to 100% for non-residential properties, for tax payable in 2020.
Today, DPM Heng announced that a new Bill will ensure that property owners pass this rebate fully onto tenants. This ensures tenants, such as F&B businesses, can defer rents and loans during these tough times, and enable them to hold onto their workers better.
The government will take the lead and set an example. Tenants of government-owned property, such as hawker centres and industrial and agricultural spaces, will receive 1 month rental waiver. This is an increase from the previous 0.5 month waiver.
In the meantime, stallholders in hawker centres managed by the National Environment Agency (NEA) or NEA-appointed operators will continue to receive three months of rental waivers, whereas government agencies’ commercial tenants will continue to receive two months of rental waivers.
Most pertinent to homeowners with loans and bills to pay would be the cash payouts they would receive, and when they’ll receive them. With the Solidarity Budget annoucement, the payouts have been slightly restructured with the government topping up another $300 and making the first payment earlier.
The first cash payment to be disbursed is the Solidarity Payment, which is a one-off payment of $600 in cash for all Singaporeans aged 21 and above. It’ll be disbursed on 14 April 2020 via bank account, or in stages from 30 April 2020 onwards by cheque depending on your records with the government. More details in the table below.
Under the Resilience Budget, those on the Workfare Income Supplement (WIS) scheme also stand to receive a one-time cash payout of S$3,000 each—an important support for low-income homeowners with a mortgage and bills to pay.
There are other smaller payouts, which will be disbursed in June 2020:
- Additional payout for parents: $300
- Cash to Replace PAssion Card Top-up (for Singaporeans aged 50 and above): $100
Helping full- and part-timers hang on to jobs… by incentivising companies
Additionally, for the month of April, the government will provide local employers a wage subsidy of 75% per local employee for all sectors under the Enhanced Jobs Support Scheme (JSS). The 75% will be counted on the first $4,600 of monthly salaries for every local employee for April 2020.
The wage subsidy for April is an significant increase from the previous 25% subsidy, and the government believes that this will go a long way to encourage companies retain their workers, at least for the duration of the circuit breaker measures.
Come May 2020, the subsidy will revert to the original Resilience Budget plan, which is a 25% subsidy for all sectors, 50% subsidy for food sector and 75% subsidy for the aviation and tourism sector.
But if you still lose your job
The previous Resilience Package stated that low- and middle-income workers who become unemployed can apply for the S$800 a month Covid-19 Support Grant that’ll be paid over three months (a total of $2,400). This grant will open for application from May 2020 to September 2020, and those who would like to apply may head to their nearest social service offices (SSOs).
It is likely that the government chose not to increase unemployment benefits in the Solidarity Budget as doing so might inadvertently encourage layoffs. (Hence the decision to boost wage subsidies for April instead.)
Homeowners who are really cash-strapped can also choose to defer their mortgage. This is available to homeowners regardless of job status and income. Read this article.
If mortgage deferment is not an option and your family needs urgent help, apply for the government’s Temporary Relief Fund by filling in this form.
Will the Solidarity Budget make up for the cost of the circuit breaker measures?
In recent weeks, it’s likely that you would already have heard of someone who has lost his job or suffered a significant reduction in his/her income. With the uncertainty surrounding the Covid-19 situation, the Solidarity Budget might ultimately still not be enough, but we should be assured by DPM Heng’s final few words.
“The Government stands ready to provide further support, should it become necessary.”
In case you want to, here’s the recorded Solidarity Budget broadcast:[Additional reporting by Ajen Kay]
What do you think about the latest Solidarity Package? Voice your thoughts in our comments section or on our Facebook community page.
Looking for a property? Find the home of your dreams today on Singapore’s largest property portal 99.co! You can also access a wide range of tools to calculate your down payments and loan repayments, to make an informed purchase.
Don't Miss Out On The Only EC Launch of 2024: Lumina Grand
About Eliza Hamizah
Looking to sell your property?
Whether your HDB apartment is reaching the end of its Minimum Occupation Period (MOP) or your condo has crossed its Seller Stamp Duty (SSD) window, it is always good to know how much you can potentially gain if you were to list and sell your property. Not only that, you’ll also need to know whether your gains would allow you to right-size to the dream home in the neighbourhood you and your family have been eyeing.
One easy way is to send us a request for a credible and trusted property consultant to reach out to you.
Alternatively, you can jump onto 99.co’s Property Value Tool to get an estimate for free.
If you’re looking for your dream home, be it as a first-time or seasoned homebuyer or seller – say, to upgrade or right-size – you will find it on Singapore’s fastest-growing property portal 99.co.
Meanwhile, if you have an interesting property-related story to share with us, drop us a message here — and we’ll review it and get back to you.
Join our social media communities!