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As Singapore move towards yet another year, the budget released recently has laid down a change in the cost of hiring foreigners over three years. Below is the report posted by MOM on their website and the attachment is a simulation over the three years for each industry.
23 February 2010 (MOM website)
Changes to take effect from July 2010
The Budget Speech 2010 has announced changes to the levy rates and levy tiers for S Pass and Work Permit holders.
2. The changes will be implemented gradually in stages from July 2010 till July 2012 (see Annex A for overview of changes and Annex B for details). The changes, implemented over three years, will provide companies time to adjust and invest in measures to boost productivity.
Key Features of the Changes
3. The key features of the changes are:
i. Increase in the S Pass and Work Permit levy rates. This is to better moderate employers’ demand for foreign manpower and to encourage investment in productivity;
ii. Greater differentiation in levy rates between skilled and unskilled foreign workers. This aims to encourage companies that need foreign workers to employ better skilled and thereby more productive ones;
iii. No change in Dependency Ratios1, but higher dependency will attract higher levy rates. This maintains companies’ access to, while at the same time encourages them to reduce reliance on, foreign manpower.
There will be no changes to the Foreign Domestic Worker levy rates.
4. MOM will also be stepping up monitoring and enforcement against employers who attempt to recover the levy from their foreign workers, whether directly or indirectly. Those who do so will be prosecuted and/or barred from hiring foreign workers.
Footnote
1A dependency ratio sets the maximum proportion of S Pass or Work Permit holders to local workers that each company can hire.
Click here to view Annex A & B
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