How will PIC Effect SMEs in Singapore?
The government has come up with new policies that will help small-scale industries emerge as stronger contributors to Singapore economy. A number of programmes and policies have proven to be effective in helping small and medium enterprises (SMEs) in Singapore operate and grow.
For one, the Productivity and Innovation Credit (PIC) Bonus has provided great support to SMEs in terms of financial support in qualifying activities such as employee training, research and development (R&D), trademark registration and such.
The programme aims to improve the productivity of SMEs in a period of economic transition. The businesses that can be eligible for the PIC Bonus include partnership companies, sole-proprietorships, and companies that have spent $5,000 in productivity and innovation activities and fulfill the criteria to claim the bonus.
Companies that have design projects approved by the Design Singapore Council as well as businesses that deal with acquisition and in-licensing of intellectual property (IP) rights and the patent registration can claim for the bonus. One of the key criteria in applying for the scheme is having at least three (3) local employees who are Singapore citizens or Permanent Residents and have active business operation in Singapore. With major small scale industries having the basic criteria, they can claim these bonuses easily without any application. Those who want to apply for PICs can only do it with the PIC tax deduction without any special pay out application.
This bonus works as a dollar-for-dollar matching scheme which is given in the form of tax deductions, allowances, or cash pay-out. The major objective of the bonus is to help businesses defray the extra cost of wages, rentals, and other activities that may hinder active and positive business growth. Those who put the funds in qualifying activities in their small and medium enterprises can avail and help their businesses grow manifolds without decreasing the quality or the level of productivity.
How does it affect the Small-scale Industry?
PIC bonus is one ofthe more effective programmes of the government to help SMEs work on and achieve their goals and increase productivity without being pushed down by the pressure of low funds.
As the entrepreneur or company employee works for further research, the government aids financially to help in sustained economic growth for the country. The bonus works in favor of SMEs and further helps in producing the best quality in spite of other measures taken by the company. Any additional activity by the small scale industry puts it in a better platform to collaborate with multinational firms or local business houses leading to greater growth and business opportunities in Singapore.
With the Budget 2013 coming up as the best strategic planning for small-scale industries, there is much more than PIC bonus.
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