Hurrah for the Budget? (Yes, for Income Tax)

As a budget with mostly one-off handouts e.g. growth bonus up to $800 depending on income and HDB flat size, this is a populist budget, an election budget or a pork barrel budget. To be brutally honest, it is a good budget for the masses.

We can naturally anticipate a higher GST after the election as that is the norm of the right hand giving and the left hand taking with any government, and hopefully the GST credits accompanying the higher GST to follow after the election is relatively adequate. But I look too far ahead and should focus on the budget at hand.

The selective decrease in income tax, more tax brackets and tax rebate is the most attractive for the middle income, the traditionally sandwiched class neglected in the government’s emphasis on the less privileged (with their conservancy rebates and GST credits) as the ultra-rich can take care of themselves. A 20% tax rebate capped at $,2000 is repeated.  The last time it was done was in 2008 and if this is done every 2-3 years, it is indeed lots of money saved for the taxpayer. There is also the significant decrease in tax for those earning less than $160,000 per year. Those earning less than $40,000 a year have an income tax of 3.5% instead of 5.5%, the biggest drop in tax rates actually among all the income tax groups.

While not everybody would be happy as greed is good, the government has probably appeased most of the middle class for now with the income tax revisions.

 

Singapore budget unveils cash grants, tax cuts
AFP – Saturday, February 19

SINGAPORE (AFP) – – Singapore on Friday unveiled more than a billion dollars in grants and will increase the tax firms must pay for hiring foreign staff amid expectations a general election will be called soon.

Lower-income Singaporeans will receive up to Sg$800 ($627) by May 1 as their share of the city-state’s record 14.5 percent economic growth in 2010, Finance Minister Tharman Shanmugaratnam told parliament.

“To share the fruits of last years exceptional economic growth, I will give growth dividends to all adult Singaporeans,” he said.

“The majority of Singaporeans — 80 percent — will get Sg$600 to Sg$800 each… The growth dividends will benefit about 2.5 million Singaporeans and cost the government Sg$1.5 billion ($1.18 billion) this year.”

Shanmugaratnam also rolled out income tax reductions and rebates aimed at the middle class.

Rising inflation and a massive influx of foreign workers in recent years are expected to be hot issues in elections that must be held within a year.

Tharman said levies on companies hiring foreigners will be raised next year in order to slow down the flow of guest workers mostly coming from China, India and Southeast Asia.

“If we do not take further steps now to raise the foreign worker levy, it will be difficult for us to prevent the proportion of foreign workers from rising over time, and exceeding our long-term target of one-third of the workforce,” he said.

With falling birth rates threatening its long-term economic prospects, Singapore rolled out the welcome mat for foreign workers during the 2004-2007 global economic boom.

But after the 2008 financial crisis, the government took a fresh look following complaints from citizens that foreigners were increasingly competing for jobs, housing, medical care and even space on metro trains.

Eugene Tan, an assistant law professor at the Singapore Management University, said the government would likely call elections before June.

“I think probably within the next… two to three months. The budget certainly puts it (government) in the good books of Singaporeans,” he told AFP.

“I think certainly the entire package sweetens the ground… This certainly is a very good position to go to the voters and seek their mandate… It’s as good as it can be.”

Property Buyers Strike Back

Especially now as developers might be rushing to build projects before the property market demand tapers off, shoddy workmanship could be the result. City Developments Limited‘s reputation is taking a hard knock here as their contractors cut corners and did a poor job. Water leakages in the car parks and units are the main problems and who wants a leaky apartment, regardless if it is a HDB or private one.

The condo at the centre of the controversy is Emery Point. The asking price for one unit at that condo is about $1.4 million for a 1300 sqft unit. So if you want to buy that condo and perhaps other CDL projects built around that time, caveat emptor.  It is surprising that this case had to go to court as CDL should have tried to settle it rather than allow this public relations disaster to happen.

Development Name:	Emery Point
Property Type:	Apartment
Developer:	City Developments Ltd
Tenure:	Freehold
Completion Year:	2005
# of Floors:	19
# of Units:	51

(source: Property Guru)

 

Condo owners sue developer, 7 other parties over alleged defects
05:56 AM Feb 08, 2011
by Leong Wee Keat

SINGAPORE – They allege that their basement car park has 280 points of water leakage, that their swimming pool has sharp surfaces that cut swimmers and ruin their swimwear, and that a third of their condominium’s 51 units are leaking rainwater.

These are some of the alleged defects that disgruntled unit owners of freehold development Emery Point, an 18-storey single residential tower at Ipoh Lane in Katong, are citing in a lawsuit against its developer, main contractor, sub-contractors and architect – eight parties in all.

As the case began in the High Court yesterday, City Developments Limited (CDL) said in defence that “some defects to the common property” arose from the contractor’s poor workmanship, even as CDL’s lawyer Ling Tien Wah argued that “there’s no such thing as a perfect building”.

CDL intends to show during the 10-day hearing that it is contractually liable to only two owners who bought their units before the completion date in September 2003.

“Caveat emptor applied to owners who bought units from CDL after the Certificate of Statutory Completion date and, as such, even if there are building defects, these owners have no remedy against CDL,” said Mr Ling.

But Mr Leo Cheng Suan, lawyer for the condominium’s current management corporation, said that as CDL’s managers were council members of the management corporation until 2007 and “fully aware” of the issues, the company had “shirked” its duty.

The management corporation’s role will also be highlighted by main contractor Hytech Builders and two sub-contractors, Heng Boon Seng Construction and Industrial Contracts Marketing, who claim that it failed to maintain the property and that any problems were caused by wear and tear.

But, Mr Leo feels, this “misses the point” as the alleged defects had surfaced early. “These defendants are only prepared to do cosmetic patch repairs at the very least possible cost: Grouting time and time again, applying silicone to try to stop the leaks for a few months until the silicone dries up and the occupiers scream at them again,” he said.

Tender prices submitted by three general contractors indicate that rectification work may cost between $512,380 and $626,350