6 in 10 SMEs say GST hike can stymie business growth in 2023

SMEs are also concerned about global inflation and rising energy prices.

More than half of small and medium enterprises (SMEs) in Singapore (63%) believe the GST hike, which took effect on 1 January, will cause their business growth for the year to stumble.

Apart from the GST hike, QBE Insurance reported that SMEs are wary about global inflation (76%) and rising energy prices (64%).

To mitigate the possible effects of these conditions, SMEs are looking to the government for support and relief (43%). Most of them (73%), however,  would resort to cost control measures. Some (44%)  said they are ready to downsize or streamline as a countermeasure.

Despite these concerns, SMEs are still optimistic towards Singapore’s economy, with 59% saying that the economy improved in 2022. More than half of SMEs (59%) also expect economic conditions to improve in 2023.

SMEs’ positivity in the economic outlook extends to their business growth views, with 58% expecting further increases in their business in 2023 and 41% expecting their size of business to increase this year. 

Almost half of the SMEs surveyed (47%) also expect to spend more on capital, while 42% expect to hire more staff in the upcoming year.