December 2022 / Singapore

December 14 2022

Overview of GST Rate Change

In Budget 2022, the Minister for Finance announced that the GST rate will be increased from:

  • 7% to 8% with effect from 1 Jan 2023; and
  • 8% to 9% with effect from 1 Jan 2024.

The factors determining which GST rate is to be applied in your invoicing are:

  • when payment is received from your customer
  • when goods are delivered/ services are performed for your customer.
For any standard-rated supplies of goods or services that you make on or after 1 Jan 2024, you must charge GST at 9%. For instance, if you issue an invoice and receive payments for your supply on or after 1 Jan 2024, you must account for GST at 9%.
If you are a GST-registered business that is subject to reverse charge (“RC business”), you must account for GST at 9% on the services you procure from overseas suppliers (“imported services”) on or after 1 Jan 2024.
However, the special transitional rules for supplies that spanned the first change of rate from 7% to 8% will similarly apply to supplies that span the second change of rate from 8% to 9%.
Failure to account for GST on your supplies at the correct rate may attract penalties. Being prepared for GST rate change will help you avoid such increases to your business and compliance costs.
Diacron expertise can help you understand the implications and guide you through an efficient and effortless update to the new GST requirements, ensuring compliance.

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December 13 2022

Launch of the Manpower for Strategic Economic Priorities (M-SEP) scheme to support firms’ expansion plans

The Ministry of Trade and Industry (MTI), together with the Ministry of Manpower (MOM) and participating economic agencies, has launched the Manpower for Strategic Economic Priorities (M-SEP) scheme.

The M-SEP scheme was first announced by Minister for Manpower and Second Minister for Trade and Industry Dr Tan See Leng, in his MOM Committee of Supply 2022 speech on 4 March 2022. The scheme complements the changes that MOM is making to Singapore’s work pass framework, by supporting the growth of businesses that contribute to Singapore’s strategic economic priorities through ambitious investment, innovation, or internationalisation activities.

Designed to support firms that are needle-movers for Singapore's economic priorities and competitiveness, M-SEP will help these firms seize opportunities to grow in Singapore successfully, while securing jobs and training opportunities for Singaporeans in the process.

The scheme gives qualifying firms the flexibility to temporarily hire S Pass and Work Permit holders above the prevailing Dependency Ratio Ceiling (DRC) and S Pass sub-DRC. To qualify, firms must also commit to employ and/or train locals. Eligible firms can obtain additional S Pass and Work Permit quotas of up to 5% above their base workforce headcount, subject to a cap of 50 workers per firm. Such additional flexibilities accorded under the M-SEP scheme will last for 2 years upon enrolment, and may be renewed thereafter, subject to meeting renewal conditions.

To qualify for the scheme, firms must satisfy both of the following conditions:
  1. Condition 1 - Participate in programmes or activities in line with one of the following key economic priorities:
    • Investments which support Singapore’s hub strategy
    • Innovation or Research & Development (R&D)
    • Internationalisation
  2. Condition 2 - Commit to hiring and/or training locals.

To be eligible for M-SEP renewal, firms will also have to show that they have met both commitments by the end of the M-SEP support period. Firms will also have to maintain their local workforce share during this period. Those that fail to do so will be suspended from M-SEP for 2 years.

The M-SEP scheme signals Singapore’s commitment to remain open and connected, and the Government’s continued support for our businesses to amplify economic growth and the creation of more good jobs for Singaporeans. Applications are now open.

Source: Government of Singapore - Ministry of Manpower