SINGAPORE: Singapore’s Ministry of Finance has launched its annual consultation on tax and spending proposals to be included in this year’s Budget.
The public can provide views through various channels, including at public events being held up until January 12, 2018. In addition, on December 4 the Government launched its REACH Pre-Budget 2018 microsite, intended to support Singaporean taxpayers to provide their views through the online portal.
“Budget 2018 provides a good opportunity for us to review Singapore’s progress and to chart a path into the future”, said Minister for Finance Heng Swee Keat. “We must plan ahead – to restructure the economy, create good jobs, and build a sense of community. I welcome all to join in this conversation. Let’s build an endearing home and a vibrant city, and create a better future together.”
Singapore is expected to announce tax hikes in this year’s Budget. In November, Singapore’s Prime Minister, Lee Hsien Loong, confirmed that the tax burden would need to rise in the near-term to offset increased spending. “For this current term of Government, we have enough revenue. But our spending needs will grow… raising taxes is not a matter of whether, but a matter of when,” said Lee, at the People’s Action Party conference, held on November 19.
The statement echoed comments made by Finance Minister Heng Swee Keat earlier this year, in which he warned that Singapore faces rising domestic expenditure as the Government invests more in healthcare and infrastructure. “We will have to raise revenues through new taxes or raise tax rates. We are studying the options carefully,” he said in his Budget 2017 Speech in February. “We must make these decisions in good time, to ensure that our future generations remain on a sustainable fiscal footing.”
Also in November, Singapore’s Senior Minister of State for Law and Finance, Indranee Rajah, indicated that the territory may soon opt to introduce goods and services tax on purchases of low-value items from online retailers.
Singapore does not subject low-value consignments to goods and services tax if the goods purchased online are worth less than SGD400 (USD296).
Announcing the measure, she said in an interview with Bloomberg on November 21: “You can imagine, 20 years from now, the way people purchase is very different and by that time online platforms will be mainstays, so if that’s not part of the tax regime, there’s going to be a lot of holes there. It’s not something we’re going to rush into but it’s also not something you can put off for too long.”
