Wednesday, 12 August 2015

GST increase after GE2015?

No basis to claims of GST hike: MOF
By Chong Zi Liang, The Straits Times, 8 Aug 2015

There is no basis to claims that the Government will raise the goods and services tax (GST) after the next general election to fund increased spending, the Ministry of Finance (MOF) has said.

Such claims, which have been made on some websites, are inconsistent with what the Government recently stated, the ministry said in a post on the Government's website

Don't worry! There are no plans to raise the GST after the next GE!
Posted by on Thursday, August 6, 2015

Stickers with the slogan "Say No to 10 per cent GST - vote wisely" and incorporating the People's Action Party's (PAP) logo have been seen distributed. Copies of one such sticker were distributed at a Singapore Democratic Party walkabout in Holland-Bukit Timah GRC on Friday.

In its post, the Finance Ministry said that in the debate in Parliament on the Budget in February, Deputy Prime Minister Tharman Shanmugaratnam said the increased spending planned for the rest of this decade is sufficiently provided for by measures that the Government had already taken.

For instance, Temasek Holdings will be included in the Net Investment Returns framework starting from next year, a move that will allow the Government to draw on up to 50 per cent of Temasek's long-term expected returns.

Also, the marginal income tax rate for the excess of taxable income above $160,000 a year will be increased by 1 to 2 per cent for taxes to be paid in 2017, with the top marginal tax rate increased from 20 to 22 per cent for taxable income in excess of $320,000.

"These measures came after moves in recent years to make Singapore's property tax rates more progressive, with significantly increased tax rates for high-value residential properties, offsetting reduced tax rates for lower-value homes," the statement added.

GST of 3 per cent was introduced in Singapore on April 1, 1994. It was raised to 4 per cent in 2003, and to 5 per cent in 2004. In July 2007, it was again adjusted to its current rate of 7 per cent.

Talk of a GST hike cropped up ahead of the 2011 General Election as well, and that was also dispelled by the Government. Prime Minister Lee Hsien Loong stepped in at the time, as he and fellow PAP MPs distributed fliers to residents stating there would be no such rise.

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