‘A decision not taken lightly’: Heng Swee Keat explains reasons for GST hike
Rounding off the Budget debate in Parliament, Mr Heng outlined that the increase in GST is required to support needs like healthcare, pre-school education and security.
Read more at https://www.channelnewsasia.com/news/singapore/budget-2019-heng-swee-keat-explains-gst-hike-reasons-11297722
As we have accumulated budget surplus of more than S$18.8 billion in this term of office over the couple of years - suggest it should be plough back to the 3 Sovereign Funds - GIC, MAS, Temasek Holdings for investment to grow the NIRC (Net Investment Return Contribution).
With higher NIRC, then the pressure to increase taxes such as GST, personal income tax etc can be further push back until a time that needed it.
Assuming 4% - 6% interest can be earned by the 3 Sovereign Funds - about $752 million to $1.128 billion NIRC can be earned.
Imagine if you buy $100, you pay $9 to govt (28.57% hike in GST from 7 to 9). So for poor people like me who don't qualify to pay income tax, will still pay an effective 9% tax rate on almost all my expenses.
Increase in Gst will cause more impacts to elderly and poor Singaporean. The government should take into consideration reducing the gst and increase in the income tax. At least the poor or the elderly with low income or no income can survive with what they have.
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