Work permit, S Pass levy increases announced

Work permit, S Pass levy increases announced

IMPACT – MEDIUM

What is the change? Work permit levies for foreign workers in the construction and services sectors will increase between 7 and 18 percent, depending on the category of permit. Levies for S Pass holders will increase between 5 and 18 percent.

What does the change mean? Affected employers should plan for the pending increases.

  • Implementation time frame: July 1, 2016
  • Visas/permits affected: Work permits in the construction and services sectors; S Passes.
  • Who is affected: Employers, work permit holders in the construction and services sectors, S Pass holders.
  • Next Steps: Affected companies must be sure they comply with the new levies once they take effect July 1.

Background: Heng Swee Keat, Singapore’s minister of finance, announced March 24 that Singapore would increase some foreign worker levies this year. The exact amounts became available last week.

Type of Permit or Pass Current Levy July 1, 2016 Percentage

Increase
Construction Sector Work Permit (R2) SG$550 SG$650 18 %
Services Sector Work Permit (R2) – Basic Tier SG$420 SG$450 7 %
Services Sector Work Permit (R2) – Tier 2 SG$550 SG$600 9 %
Services Sector Work Permit (R2) – Tier 3 SG$700 SG$800 14 %
S Pass – Basic Tier SG$315 SG$330 5 %
S Pass – Tier 2 SG$550 SG$650 18 %

The levy rates for basic tier R2 construction workers will be raised again on July 1, 2017 to SG$700.

As was previously announced, a one-year freeze will be placed on levy increases in the marine and process sectors because of a reduction of work permit holders in those sectors. There will also be no increase to work permit levies in the manufacturing sector, as was announced in 2015.

BAL Analysis: Singaporean officials are striving to boost revenue by raising S Pass levies and work permit levies in certain sectors. At the same time, they have moved to stop planned increases in sectors where the number of work permit holders has declined. Employers affected by the changes should plan for the increases, which take effect July 1. 

This alert has been provided by the BAL Global Practice group in Singapore. For additional information, please contact singapore@bal.com.

Copyright © 2016 Berry Appleman & Leiden LLP. All rights reserved. Reprinting or digital redistribution to the public is permitted only with the express written permission of Berry Appleman & Leiden LLP. For inquiries please contact copyright@bal.com.

More immigration news

See More