Singapore: Greater means contribute a larger share
In my second year of working life, I told my mother that I was being taxed more than the year before. My mother casually commented, ‘The higher your pay, the higher your taxes will be.’ How profoundly true. I yearn to pay higher taxes after that. Of course, we do note that the super wealthiest do appoint tax consultants to ensure they are not overpaying their taxes. Anyway, I seriously do not mind to pay ever higher taxes if my income keeps growing too.
One country is validating what my mother said to me way back in the year 2000. 🙂
Article in themalaysianreserve.com Singapore raised taxes on its wealthiest by 1% and increased other levies as it aims to bolster its finances to chart a post-pandemic future.
Finance Minister Lawrence Wong said the new changes are needed to foster a “fairer revenue structure.” He said, “That means everyone chips in and contributes to a vibrant economy and strengthened social compact, but those with greater means contribute a larger share.”
Wong said, “Our budget remains expansionary to support the economy.” Please do read the article with a lot more details here: Article in themalaysianreserve.com
Expansionary Budget is always needed when the economy needs support
Sometimes, the private sector may not be able to shoulder all the necessary investments into growing the economy. They may be hesitant due to some confidence level, they may not have the capacity to do so especially if their revenues were affected by unforeseen circumstances and there may be other reasons and this is where the government will step in.
Singapore will also be raising the Goods and Services Tax (GST) by 1% in 2023 and another 1% in 2024. This will increase the GST from current 7% all the way to 9% by 2024. News as per Straits Times Singapore here. This should help it to go back to the usual budget surplus on all the years before Covid-19 arrived. GST is certainly a much better tax structure than what Malaysia has currently which is the Sales and Service Tax.
Well, I am not the government and could not change it back to the right track currently. All the best then as we continue to see how countries with GST continue to gain tax revenue corresponding to the country’s GDP growth. Cheers.
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