Consumers to pay GST for Netflix and other overseas digital services: 5 other policy changes from Jan 1

SINGAPORE - From Jan 1, those who subscribe to Netflix and other overseas digital services will have to pay a 7 per cent goods and services tax (GST).

Here are five other policy changes that will affect you from New Year's Day next year.

1. Increase in Central Provident Fund (CPF) retirement sum payouts

Some CPF members will see an increase in monthly payouts in their retirement.

Payouts through the Retirement Sum Scheme (RSS), the main CPF retirement payout scheme for members born before 1958, will last up till age 90, instead of the current 95, from next year.

More than a third of members on the RSS who are currently receiving their payouts, or some 60,000 people, will see an increase in payouts, Manpower Minister Josephine Teo announced in Parliament in November.

The new rules will apply to all RSS members who turn 65 from July 1, 2020, and will take effect from Jan 1, 2020, for those who are currently receiving payouts.

Around 160,000 RSS members have passed the payout eligibility age and have started receiving payouts.

2. Higher Basic Healthcare Sum

The Basic Healthcare Sum - or estimated savings required for basic subsidised healthcare needs in old age - will be raised from $57,200 to $60,000 for CPF members below 65 from Jan 1.

Those who turn 65 in 2020 will have the sum fixed at $60,000, which will not be changed.

Those who are 66 and above in 2020 will see no changes to their cohort's Basic Healthcare Sum.

The Basic Healthcare Sum is adjusted yearly for members below 65 years of age to keep pace with the growth in Medisave withdrawals. Once members reach 65, the sum will be fixed for the rest of their lives.

3. Minimum age for smokers to be raised to 20

The minimum age for smoking will be raised to 20 on Jan 1, as Singapore further intensifies its efforts to get people to stub out.

The minimum age was raised from 18 to 19 in January this year, and will be raised to 21 on Jan 1, 2021, the Ministry of Health (MOH) announced in December 2018.

The ministry said then that progressively raising the minimum legal age for the purchase, use, possession, sale and supply of tobacco products will prevent youth from picking up smoking by limiting access to tobacco products.

4. Tighter foreign worker quota

Companies in the service sector will have to rely even less on foreign workers.

The Government is tightening the dependency ratio ceiling, or the proportion of foreign workers a firm can employ, from 40 per cent now to 38 per cent on Jan 1 next year, and to 35 per cent on Jan 1, 2021.

For the subset of S Pass workers - mid-skilled foreigners earning at least $2,300 a month - the quota will be cut from 15 per cent now to 13 per cent on Jan 1 next year, and to 10 per cent on Jan 1, 2021, Finance Minister Heng Swee Keat announced during the Budget speech in February.

5. Fewer approved overseas medical schools

Those going overseas to study medicine with the aim of practising as doctors here will have fewer schools to choose from.

The number of approved overseas medical schools will be cut from 160 to 103 from Jan 1 next year, the Singapore Medical Council (SMC) and MOH announced in April.

Students who have already secured a place or who are currently studying at one of the 57 schools will not be affected.

The revision was done to ensure that the quality of foreign-trained doctors practising here remains high and as local universities expand their places for medicine, MOH and SMC said.

This article was first published in The Straits Times. Permission required for reproduction.