Budget 2015: Companies to receive enhanced support for innovation and internationalisation
TODAY file photo
SINGAPORE — Companies focusing on innovation, research and development (R&D) and internationalisation will be receiving enhanced support through various grants and schemes, said Finance Minister Tharman Shanmugaratnam as he delivered the Budget Statement today (Feb 23).
The Capability Development Grants (CDG) by SPRING Singapore, which financially assists small and medium enterprises (SMEs) in developing capabilities in innovation, will find the application process easier to apply for projects under S$30,000. The funding support of up to 70 per cent of costs will also be extended till March 31 2018.
The National Research Fund, which invests in research and development (R&D) to enhance the Singapore economy, will receive a top-up of S$1 billion this year, said Mr Tharman, who is also Deputy Prime Minister. Companies invested in R&D will also be supported through the Research, Innovation and Enterprise five-year plan, details of which will be provided in the later part of this year.
Start-ups will also have easier access to the capital they need to grow. The Government will increase the co-investment cap for two schemes by SPRING — the Startup Enterprise Development Scheme (SEEDS) and Business Angel Scheme (BAS) — to S$2 million per company. This will allow companies to receive up to S$4 million each in total funding raised for potentially promising companies that are less than five years old.
The Government will also start a pilot programme for venture debt risk-sharing, whereby SPRING will provide 50 per cent risk-sharing with selected financial institutions over an initial period of two years to high-growth companies. More details will be announced by SPRING separately, Mr Tharman said.
Supporting companies to internationalise is a key strategy to help them grow revenues, added Mr Tharman. The support for SMEs under IE Singapore’s grant schemes will be increased from the current 50 per cent to 70 per cent for three years.
The Double Tax Deduction for Internationalisation Scheme to cover salaries for Singaporeans posted overseas will also be enhanced, said Mr Tharman. Larger Singapore companies will also benefit from a new tax incentive, the International Growth Scheme, which will get a 10 per cent concessionary tax rate on incremental income from qualifying activities.
Companies which are growing through mergers and acquisitions (M&A) will enjoy tax allowance for acquisition costs from the current 5 per cent to 25 per cent the value of the acquisition. The M&A scheme will be extended till March 31 2020. The IE Singapore’s Internationalisation Finance Scheme to support M&A will also be extended, with maximum loan quantum doubled since last year’s Budget from S$15 million to S$30 million.
READ THE FULL BUDGET STATEMENT HERE
Other documents on Budget 2015 available on the Budget 2015 website.
