SURGING business costs, brought on by last year’s increase in the Goods and Services Tax (GST), higher office rents and rising oil prices, are chief among the worries of Singapore Chinese Chamber of Commerce and Industry members.
This was the finding of the chamber’s annual pre-Budget survey sent to all of its 4,000 corporate members in December and last month. It showed that members are hoping this year’s Budget, to be announced tomorrow, will address the issue of the rising costs of doing business.
Respondents believed that increased business costs caused by dearer raw materials such as oil and more expensive manpower, among other factors, had also led to lower customer sales. This caused corporate profits to fall even further.
Looking to the year ahead, respondents expressed fears that escalating taxes, levies and other charges might have an impact on businesses directly.
This would further erode Singapore’s competitiveness, especially when foreign competitors are able to undercut the Republic with lower overheads and labour costs, the chamber said.
On the list of wishes that the companies have is a lowering of government taxes and charges, especially corporate income tax.
‘Personal income tax should be reduced to 18 per cent. As for the corporate income tax, the Government could also consider increasing the ceiling of chargeable income qualifying for tax exemption,’ the chamber said in a statement yesterday.
In order to ensure Singapore continues to excel as a hub for meetings, incentive trips, conventions or exhibitions, the chamber also urged the Government to consider exempting such events from the GST to help local businesses cope with surging rents.
The respondents also called on the Government to relax laws to open up new labour sources.
‘For local enterprises, the respondents hoped that the Government could render more support, such as more assistance schemes for local companies to upgrade and train their workers,’ the statement said.
‘They also called for more pro-enterprise measures so that smaller companies could gain greater access to public projects.’
Source: The Straits Times 14 Feb 08