SMEs hail deferral of foreign worker levies

Firms can take a breather this year.

Small and medium enterprises hailed the government’s decision to defer this year’s round of levy increases for S Pass and Work Permit Holders in every sector.

Deputy Prime Minister Tharman Shanmugaratnam stated that the deferral will give companies, especially SMEs, more time to adjust to the new normal of a permanently tight labour market where it is both difficult to find Singaporean employees and foreign workers are no longer an easy solution.

The Singapore Business Federation warmly welcomed this development. In its Budget 2015 recommendations, the SBF-led SME Committee had previously called for the government to hold back on any further planned increases in foreign worker levies and remove the levy for S Pass holders.

“We are delighted with the deferment of levies for S Pass and Work Permit holders to help businesses manage rising costs,” said Lawrence Leow, Chairman of the SBF-led SME Committee.

However, Deputy Prime Minister Tharman Shanmugaratnam yesterday reiterated that the deferral does not mean that the government is changing its stance on restructuring.

“It remains crucial for Singapore that we restructure towards reducing our reliance on manpower, and find new and more innovative ways to do business,” he said.