SINGAPORE: Raising the Goods and Services Tax (GST) is the likeliest means through which Singapore could bump up tax revenues, though there is no pressing need to undertake such a “politically challenging” move anytime soon, economists and tax experts said on Monday (Nov 20).
They were responding to a speech by Prime Minister Lee Hsien Loong on Sunday, where he reiterated that it was a matter of when, and not if, taxes would be raised. While the Government has enough revenue for the current term, future expenditure is expected to go up significantly in areas such as social safety nets and services — including healthcare — and investments in infrastructure, he pointed out.
“Well before that time comes, we have to plan ahead, explain to Singaporeans what the money is needed for, and how the money we earn and we spend will benefit everyone young and old,” said Mr Lee.
Noting that Singapore’s GST is among the lowest regionally and has stayed unchanged for a decade, the experts suggested that a hike could happen within five years, and the rate could rise to as much as 10 per cent.
