More than S$8.3b disbursed in tax rebates to encourage procreation

More than S$8.3b disbursed in tax rebates to encourage procreation
By Imelda Saad | Posted: 20 January 2013 1802 hrs
     
SINGAPORE: The government last year gave out more than S$8.3 billion in tax rebates and reliefs aimed at encouraging procreation in the Year of Assessment 2012.

The Inland Revenue Authority of Singapore also told Channel NewsAsia that more than 850,000 working mums and dads enjoyed such tax breaks in 2012.

Thirty-six-year-old assistant marketing manager Lum Sook Fong collected nearly S$27,000 in child tax reliefs last year.

Together with other rebates, the working mother of two ended up not paying any taxes to the government at all.

Madam Lum said: "I know there should be some kind of relief but exactly what amount, I didn't know until I get the statement, so I was kind of surprised because the amount is quite substantial."

Currently, there are three kinds of rebate and reliefs aimed at supporting working mums with children.

They are: Parenthood Tax Rebate of up to S$20,000 per child; the Qualifying/Handicapped Child Reliefs; and the Working Mother Child Relief.

Both the Parenthood Tax Rebate and the Qualifying/Handicapped Child Relief can be claimed by both mums and dads.

Sums worked out by tax consultant Ernst & Young show that working mums earning about S$94,500 to S$351,000 a year don't have to pay any taxes after taking into account the Parenthood Tax Rebate, the Working Mother Child Relief, and other tax breaks like the Foreign Maid Levy Relief.

This applies to a Singaporean tax payer aged 55 and below, married, with three children.

There are various monetary incentives to support families, including cash gifts like the Baby Bonus.

Those Channel NewsAsia spoke to say while such incentives can ease the financial burden of bringing up baby, money isn't everything.

It may encourage those who already have children to have more but it may not change the minds of couples who don't want any children in the first place.

Joni Ong, president of advocacy group I Love Children said: "I agree that money is useful but money isn't everything. I believe if you love children and you want to have children to complete your family, no matter how much money is there or not there, you will proceed to have the babies anyway."

Experts said what is needed is a supportive environment at home and at work, among other things.

"For my case, I would think it would be useful as well if the Baby Bonus is higher because what we have, could only tied us for the first few years. After that, I have to start paying cash for their childcare," said Madam Lum.

She added: "Another part is also the family support like maybe having grandparents to be there to take care of the kids. As a working mum, I would say that the environment is very important and also the work-life balance that we have."

- CNA/fa

- wong chee tat :)