SINGAPORE BUDGET 2023: NO TECH STARTUP OR SME LEFT BEHIND FROM ENHANCED R&D AND INNOVATION INCENTIVES AND SCHEMES

Grace ChngFeb 20, 2023

 

Local tech companies gave the thumbs up for the enhanced tax incentives on innovation and R&D expenses unveiled last week in the Singapore Budget 2023. They can get tax reductions for five activities, namely, R&D conducted in Singapore; registration of intellectual property including patents, trademarks and designs; acquisition and licensing of IP rights; innovation carried out with polytechnics and the Institute of Technical Education (ITE); and training via courses approved by SkillsFuture Singapore which are aligned to the Skills Framework.

Even start-ups and SMEs will benefit from this programme. They can claim for a new cash conversion total qualifying expenditure per year of assessment into a cash payout of up to $20,000 across the five activities.

Local businesses welcomed the focus on innovation and R&D as a much needed scheme to boost digital transformation efforts.

Andy Ng of Veritas said the focus on innovation and R&D is critical because technological innovation is key to propelling the Singapore in the right direction to explore new frontiers and maintain its competitive edge.

In the face of rising inflation and looming economic slowdown, most business leaders would default to cost-cutting measures for their immediate to mid-term survival, said Ng, Veritas’ vice-president and managing director for Asia South and Pacific region.

The incentives would not force local companies into a dilemma of choosing between resilience and innovation, he added.

The enhanced support will also help local companies innovate and become more competitive as they bounce back from the pandemic,” said Sojung Lee, TeamViewer’s president for Asia-Pacific region.

She observed that during the pandemic, augmented reality had played a big role in lessening the disruptions of manpower training as it provided an avenue for organisations to train their people remotely.

As an example, she observed the automotive industry who trained new employees to inspect and repair cars using 3D hologram. Using special lenses and TeamViewer’s software, they could “see” the instructions on top of an actual car.

Going forward, she said that “there is a lot more to improve and develop about the industrial metaverse, which we hope the budget support from the government can further drive”.

Apart from the support for innovation and R&D, the support for SMEs overseas expansion activities were also welcomed. Terry Maiolo, vice-president and general manager, Asia-Pacific for OVHcloud, said the Singapore Global Enterprises initiative will support local enterprises efforts to better manage various challenges such as regulations and logistical complexities when they expand internationally. 

The S$1 billion boost to this initiative will provide local enterprises with customised assistance to strengthen the core leadership teams of local enterprises, accelerate internationalisation plans, and build a strong talent pipeline.

For SMEs, an additional S$150 million will also be set aside for the SME Co-Investment Fund to support them to get capital to grow and be globally competitive.

Grace Chng is Director of Verticus Consultants and Technology Writer and Author

Tell us about your thoughtsWrite message

Your email address will not be published. Required fields are marked *

Back to Top
Close Zoom
Context Menu is disabled by theme settings.