From 1 July 2007, small and medium -sized enterprises in Singapore can apply for labour cost rebates. This scheme, unveiled in Budget 2007 is introduced to help these firms ease into a 1.5 percentage point hike in the Central Provident Fund (CPF) employer contribution rate which takes effect 1 July 2007.
Singapore registered manufacturing firms with fixed asset investments of less than $15 million will qualify for the rebate. Non-manufacturing firms will have to fulfil the additional requirement of having less than 200 employees.
The rebate is 2% of the first $40,000 of total CPF contribution and 1% of the next $40,000 in the first year from 1 July 2007, and 1% and 0.5% respectively for the second year.
