Tax the wealthy instead of burdening average Singaporeans with GST hike: Ex-NMP

Former Nominated Member of Parliament (NMP) Calvin Cheng has challenged the GST hike that Finance Minister Heng Swee Keat announced earlier this week during Budget 2018.

Taking to Facebook, Cheng criticised the “mixed messages” the Government seems to be giving, what with the two per cent GST hike and the one-off cash SG bonus that will be disbursed to Singaporeans this year.

Cheng questioned what exactly will happen during 2021-2025 that will absolutely necessitate a GST increase, and also asked the Government to release proof that show that not raising the GST will result in a deficit:

“What exactly happens in 2021 to 2025 and after that causes a gap in financing that needs an increase in GST? Can we have some projections in spending that shows that from that point on our budgets will go into deficit if taxes don’t increase ?
“Because right now, with the exception of global recession years, our budgets are so healthy, they are in surplus every year. I have no doubt that as our population ages, expenditures will increase, but why would those years be a tipping point, and by how much?

These questions were not addressed by the Finance Minister during his budget speech. Instead, the Minister identified key areas of expenditure growth (such as healthcare and infrastructure) and explained that “even after exploring various options to manage our future expenditures through prudent spending, saving and borrowing for infrastructure, there is still a gap”.

He had added: “…in the next decade, between 2021 to 2030, if we do not take measures early, we will not have enough revenues to meet our growing needs.”

The Minister also noted that the government has been tapping on the reserves over the last decade, but that we must dispense these resources “prudently” given the mature economy and aging population. He proclaimed that relying too much on the reserves will deplete Singapore’s nest egg and stressed, “this is not the Singapore way.”

Cheng compared the Minister’s cautionary remarks on managing the nation’s fiscal resources prudently, to the $700 million payout the Government will be giving out to all Singaporeans aged 21 and up this year, that comes from the exceptional budget surplus of $9.6 billion from FY 2017.

The Minister had declared that eligible Singaporeans will receive an “hongbao” of $300, $200, or $100 depending on their income and that this one-off bonus “reflects the Government’s longstanding commitment to share fruits of Singapore’s development with Singaporeans.”

Cheng questioned, however, that if Singapore will be in a poorer fiscal position if we do not dispense resources “prudently,” wouldn’t it make more sense to save the $700 million too?

“In fact, the surplus this year is so wonderful that the Government is giving away 700m dollars to Singaporeans.
“On a separate note, if things are going to be so dire from 2021, perhaps we should save the 700m to be used then rather than giving it away now?
“Talk about mixed messages : “In a few years things will be bad enough that we need to increase taxes. But right now it’s amazing so here is a present for everyone !” Huh???”

The former NMP opined that the Government should tax the wealthy and put off taxing the average Singaporean for as long as possible. To this end, he welcomed the additional stamp duty on properties over $1 million which he called a “wealth tax”.

While Cheng admits that this “wealth tax” will affect him more than a GST increase, he added that he “fully supports” it instead of measures like a GST hike that could burden lower- and middle-income Singaporeans further:

“The additional stamp duty on properties above 1m dollars is to be welcomed. It’s essentially a wealth tax.
“Much has been said about income inequality in Singapore but in my opinion, after government transfers and housing subsides, our income inequality is still not dire.
“Less attention has been given to wealth inequality. Singapore is home to one of the most high net worth individuals per capita. Most wealthy people do not make money from salaries and employee remuneration but through investments. Yet, we don’t have a capital gains tax.
“We should explore more ways to tax the wealthy in Singapore (as opposed to just high income earners) who have chosen to make Singapore their home because of the stability, peace and living environment taxes pay for. This could supplement any increase in GST or other taxes on the average Singaporean, which should be put off as long as possible.
“The additional stamp buyers duty will affect me more than a GST increase, but I fully support it.”

What exactly happens in 2021 to 2025 and after that causes a gap in financing that needs an increase in GST? Can we have…

Posted by Calvin Cheng on Monday, 19 February 2018

The additional stamp duty on properties above 1m dollars is to be welcomed. It’s essentially a wealth tax. Much has…

Posted by Calvin Cheng on Monday, 19 February 2018

GST will rise by 2%: Finance Minister confirms at Budget 2018

All Singaporeans above age of 21 will receive “hongbao” of at least $100: Budget 2018

59 COMMENTS

  1. The current G couldn’t anticipate a jump in 2017 Budget surplus within a year but can foresee a few years down the road we will have not enough revenues to meet our growing needs!

    Come, I clap for you!

  2. Once you are born, you will be taxed till you lay down on a coffin. This tax is very cruel and the party that implemented this is also very cruel. But why do you guys voted for this cruel and heartless pigs.

  3. I totally agree with Calvin in this issue. There is totally no basis for the raise of the 2%.It seems like this government has suddenly acquired a crystal ball to look into the future to make such dire prognosis.

    • Wow! You must be happy living off the crumbs that the government throws our way! They throw you $100 and immediately recoups it, even more in fact,I thement you buy those diapers for your kids, groceries for your hosehold, the medicine for your flu. Idiots like you are the reason why we are still being held at ransom, milked till the very last cent, treated like dirt by the people who are supposed to serve us.

    • That is the problem with sinki … somehow they gimmick like CSJ and LTK said before .. who teach them to always ask for gim mick.
      The teacher at school or their parents at house ? Identified those culprits and counselled them rather then this bugger spoil the society later

  4. Gimmick lah, during rally for the next GE quite sure they will blast out they fight against raise of gst. You can see why they announced 9% gst only between 2021-2025. Likely to use this gst gimmick during the next general election.

  5. For once i support him. Wat he said is just plain practical and doable. Make more sense rather than the explanation of explored deeply other avenues and the most viable one is to increase GST. As I’ve said before these ppl only do the easy job. Increase Gst…done. Really don’t deserve the millions paid to them for easy job. Any tom dick and harry can come out with the idea to increase GST to increase revenue bcoz that’s the easiest and will increase the revenue with little consequences bcoz all share the burden. They worry taxing the wealthy will make them run away together with their investment and business. If this is true then we really are paying for them to stay here?

  6. This guy have talking some sense lately, keep it up Calvin. Indeed there is no reason that GST be increased. The PAP always say they have find all means but never and always never give the real reasons for any changes they made. For me, I do not trust them at all and will scrutinize every word they said.

  7. It’s like talking from the sideline, telling footballers how to play, when you are not even member of both teams. I would suggest that he join one of the opposition party. Look at Japan. Ruling LDP members defect to form new parties. So, NMP and ex PAPMP should also do the same. Plus individual retired professionals who can be quoted as analyst (like in CNN). Only them we have s better crop in the opposition. Otherwise, it’s really old gang, old style, old play. Just like Teochew talking in Hougang. World has changed !

    • Sadly easier said than done to join an opposition party because of the PAP’s past propensity to seed moles in alleged “defectors”. Most who jump ship are viewed with a great deal of suspicion, in fact so much so that they’d be utterly ineffective even if they were truly disgusted with the PAP.

    • Kok-Yong Tan I think so too ! If we look at the experience of opposition parties in Japan, etc, there is really a need to add caliber. Otherwise, it’s really same old trousers.

  8. He is making discussion on next government , what plan is this ????? Long term plan is not like that la !!!!! PAP they sure win again tell Singaporean first don’t after election than say .

  9. When something like this happens it’s a fact of life.
    In a materialistic society like ours, the lives of “peasants” are worth and valued less than those of the “elites”… and somehow the majority of people here probably think this is only right and just. How wrong can they be.

  10. There is a saying that only two things are certain in life. Death and taxes. Governments collect taxes to use it for public expenditure. The real issue is not the 2% increase. The issue is who the government collects it from and what the government uses the money for. Many countries have tried targeting the rich and failed. One example is death taxes or estate duty. If a government tries to impose a tax on inheritance, the rich have the means to escape from it.

    I think it is more important for government to ensure that there are enough jobs for all. And to provide a safety net for those who are in great financial difficulty.

    I also fail to understand the logic of not tapping our reserves for major projects. We always hear this logic that we must save for a rainy day but when it comes, we argue that there are more rainy days ahead. This logic of over-providing for a unknown future can only fool the young and naive.

    You can fool us once. Twice. But three times?

    Philip Teo

  11. Everything come down to option, not happy with government, wealthy ppl got lots of options. Average people not many options. They rather pay more than changing government as fear of the unknown. The risk is greater. So we just come here burst our anger with gst, with mrt, with open burning, with lots of thing. Do lots of complaining and eventually felt helpless and give up. So to them just a matter of time ppl accept it just like gst from 5% to 7%. No one complaint about that anymore.

  12. Please leh…if govt tax the riches, they would take to the road, to stage protest. Furthermore, what if they opt for oversea democratic organisations to file tax exploitation against our govt, then people would think our country got serious problems.

  13. Stupidest bunch of both education people…Ah Heng is doing GST increase then his bros will open the floodgate for millions more people to flood Sg…automatically GST returns increases as more foreigners come in…Sg towards 30mil population rate?! Huat ah all property owners and 70%!

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