Foreign worker levies raised

SINGAPORE - Singapore will gradually raise the foreign worker levies, and tighten the levy tiers that are based on the proportion of foreign workers in a company's workforce, said Finance Minister Tharman Shanmugaratnam in Parliament on Monday.

The changes will start with a modest increase in levies in 2010, and will involve further increases over the next two years.

The overall dependency ratio for all categories of foreign workers (Work Permit and S Pass holders) will remain unchanged.

As a first step, levy rates will be raised by between $10 and $30 for most Work Permit holders on July 1 2010. Further adjustments in levy rates and tiers will be phased in 2011 and 2012.

'Taking the three years together, there will be a total increase of about $100 (US$71) in average levies per worker in manufacturing and services,' Mr Tharman said. 'The construction sector, where there is much scope for productivity improvements, will see a larger increase.'

Changes for S Pass workers will also be made. There will now be two levy tiers. The rates for the first and second tiers will be $100 and $120 in July 2010, up from a single rate of $50 currently.

Further adjustments will then be phased in until the rates reach $150 and $250 by July 2012.

The Manpower and National Development Ministries will release more details of the changes to the Foreign Worker Levy later this week.

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