Singapore firms clamour for less complex business rules

Simplify rules for tax incentives, they said.

According to KPMG's Pre-Singapore Budget 2014 survey, increasingly complex business regulations are symptomatic of a maturing economy, and many businesses are at the crossroads of fast advancing business regulations but yet do not havethe resource or capability to deal with this issue.

Many businesses cited claiming of tax incentives was not straightforward; despite best efforts to make correct claims, mistakes may still be made. Due to that, 45.2 percent of respondents wants less complex business regulations and more simplified rules for tax incentives.

Thus, government agencies may need to be more business-centric and try to understand the unique needs and situation of each industry.

Similarly, 96.8 percent of respondents want the Productivity and Innovation Credit (PIC) scheme extended after 2015, suggesting that productivity schemes were effective.

In 2010, the Economic Strategies Committee called for a Singapore economy based on skills, productivity and innovation. Aimed at reducing reliance on labour, it targeted 2-3 percent annual productivity growth with a 30 percent increase in wages over 10 years.

Mr Tay Hong Beng, Head of Tax at KPMG in Singapore said “Businesses have come to accept the need for Singapore to push productivity growth. With the PIC due to expire by 2015, it is no surprise many are calling for an extension. This is because the productivity journey is a long and continuous one. Some companies are also just starting out and need more help.”

While affecting most companies in Singapore, the manpower restrictions were felt more acutely by SMEs, with 24 percent citing manpower and 39 percent generally citing costs as a concern.

At the same time, 23.4 percent called for simplifying and increasing the relevance of tax and other monetary incentives. Some 21.8 percent wanted existing tax and monetary incentives to be simplified.