Call to freeze foreign worker levy hikes grows louder among SMEs

They also demand support in hiring older workers.

Small and medium enterprises are clamouring for an easing of the scheduled foreign worker levy hikes as growth slows and costs rise.

The Pre-Budget 2016 survey by the Singapore Chinese Chamber of Commerce and Industry (SCCCI) showed that 70.3% of SMEs want the government to stop raising foreign worker levies to combat rising business costs.

Meanwhile, over 65% of SMEs are asking for subsidies to support hiring Singaporean workers older than 55.

Over seven out of ten firms also called for an adjustment of foreign worker policies according to the needs of industry sectors, while over half of respondents called for the introduction of pro-SME manpower policies that would encourage fresh graduates and PMETs to join SMEs.

In a recent position paper released by the Singapore Business Federation (SBF), business leaders urged the government to re-think its foreign worker levy system.

“The levies increase the cost of doing business, especially for the sectors that are more heavily reliant on foreign manpower such as construction, retail, and food and beverage. We recommend that the Government recalibrates the levy quantum to take into consideration the latest net inflow of foreign workers into Singapore,” said SBF.

“We believe that there is scope to further defer the planned increase or even reduce some levies. For e.g., the levy for S Passes can be removed since there will still be qualification salary and quota restriction for S Pass applications. The levies for higher skilled foreign workers can also be reduced to encourage businesses to employ such workers,” SBF said.