In response to the escalating costs faced by enterprises, KPMG has emphasized the critical need to expand perks and incentive systems to encompass key growth-driving trends, including Environmental, Social, and Governance (ESG), Artificial Intelligence (AI), and machine learning.
Chiu Wu Hong, Partner and Head of Private Enterprise at KPMG, noted that customary items such as tax incentives, innovation funding, regulatory simplification, and digital-focused initiatives consistently rank high on companies’ wish lists each year. For 2024, KPMG suggests extending support with a specific emphasis on major growth drivers to enable enterprises, regardless of size, to “stay competitive and agile.”
To facilitate businesses on their ESG journey, KPMG proposes Singapore introduce a Sustainability Credit Scheme. This scheme would offer higher tax deductions to companies utilizing sustainable technologies or solutions. The idea is to incentivize the adoption of new technologies while simultaneously encouraging employees to acquire the necessary skills for their effective utilization.
Lee Bo Han, Partner, R&D and Incentive Advisory at KPMG in Singapore, highlighted the importance of making artificial intelligence and machine learning pervasive, akin to widely-used software tools in all companies. He proposed the implementation of grants and schemes aimed at uplifting all employees, ensuring proficiency in machine learning, artificial intelligence, data management, and analytics.
In addition, Han stressed the necessity for the government to enhance the attractiveness of research and development (R&D) by offering one of the highest tax deductions for R&D activities in the country. He recommended broadening the Intellectual Property (IP) development incentive to encompass patentable IP, not just registered IP. This approach, he argued, would not only encourage R&D investment but also allow companies to enjoy the benefits of recurring income derived from IP developed in Singapore. These proposals, according to KPMG, would play a vital role in sustaining business competitiveness and agility in the evolving landscape of 2024.