SMEs make up 99 percent of the enterprises in Singapore and contribute nearly half of the country’s GDP while employing 70 percent of the workforce.
In keeping with the huge contribution of SMEs to the economy, the Singapore Budget 2016 announced a number of initiatives to support this segment. Here’s a snapshot of the measures targeted specifically to support their advancement in both the domestic and international markets.
SME Mezzanine Growth Fund strengthened to aid expansion
SMEs looking for funds to expand their business can make use of the SME Mezzanine Growth Fund, which has been increased from S$100 million to S$150 million. The Government will match up to S$25 million of new private sector investment on a 1:1 basis.
“This will provide more capital to support our SMEs to scale up and internationalise,” said Finance Minister Heng Swee Keat in his Budget speech.
Supporting mergers and acquisitions (M&A) with increased allowance
The government has increased the M&A allowance on up to S$40 million of the value of the deal, an increase from up to S$20 million currently. With an enhanced 25 percent rate announced in Budget 2015, companies can now enjoy up to S$10 million of M&A tax allowance for every year of assessment.