Govt to grow earnings to pay for emerging social needs
Contractual age for deals will be lowered to 18 to boost entrepreneurship
By Erica Tay
ONE of the Finance Ministry's tasks in the coming years is to find ways to increase the revenues it collects, at a time when income tax rates have to be kept competitively low while social expenditure is expected to rise.
Thus, during his new term as Finance Minister, Prime Minister Lee Hsien Loong pledged that the priority will be to help Singaporeans 'stay together and move ahead'.
In his addendum to the President's Address, Mr Lee said that the Finance Ministry aims to balance the Budget over the business cycle and at the same time promote opportunities for economic growth and create good jobs for Singaporeans.
To boost entrepreneurship, the ministry will lower the contractual age for business transactions, proprietorships, partnerships and directorships from 21 years to 18 years.
'Changing demographics and growing social needs are pushing up social expenditure,' said Mr Lee.
'At the same time, the Government has had to reduce income tax rates amid increasing global competition to attract investments and encourage enterprise and talent,' he added.
'The Government will therefore continue to explore how best it can preserve and grow revenues, without undermining economic growth, so as to fund the necessary expenditures.'
The Singapore Totalisator Board, for one, will increase its donations towards social and community causes, Mr Lee said.
Another focus would be to grow and protect Singapore's reserves 'through judicious and prudent investments for optimal financial returns'.
These investment earnings will go towards paying for emerging needs including in health, education, and research and development, Mr Lee said.
He said the Government will also foster a business-friendly environment via the tax framework, regulatory regime and infrastructure such as the trade and logistics portal, TradeXchange.
Finally, Mr Lee outlined plans to further develop e-Government and streamline public sector processes.
Meanwhile, Senior Minister Goh Chok Tong delivered his addendum to the President's Address as Minister-in-charge of the Monetary Authority of Singapore (MAS).
The MAS, which now falls under the Prime Minister's Office, will 'enhance its forecasting, surveillance and research capabilities', said Mr Goh.
In its role as a financial industry regulator, as local players go regional and become more complex, the MAS will intensify efforts in consolidated and integrated supervision, he added.
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