According to the Ministry of Finance, the Productivity and Innovation Credit (PIC) scheme saw only a 27% successful rate out of 98,000 applications. A massive 64%, or 63,000 applications, for the government scheme was rejected. Only 27,100 applications were successful, and 2,300 require clawback due to inaccurate claims filed by Singapore businesses. The local tax authority, IRAS, has only conducted 98,000 out of 313,000 claims made between 2011 and 2016.
The PIC scheme was introduced in 2010 and it subsidises Singapore businesses spending “associated with innovation”. As the Singapore government did not give a clear definition of what is claimable, many businesses abused the government scheme buying expensive “productive equipment” – wasting hundreds of millions in taxes.
The Singapore government covered up the total amount of payout of the PIC scheme, there is also no measurement on the success rate of each PIC dollar paid out. The only unofficial measurement for the PIC scheme is Singapore’s productivity, which has been an average 0.5% since 2011.
The PIC scheme will end in FY2018 but local businesses are desperate to continue the PIC scheme as it greatly subsidises business costs.