Monday, January 26, 2009

GST Rebates vs Roll-back of GST

Today I was reading an article on asking for the roll-back of the additional 2% Goods and Services (GST) tax to ease the burden. Maybe it's due to the CNY but somehow, the GST rebates came into mind.

An average young Singaporean, staying in a HDB 4 room flat, earning about $30k per year will get $400 GST rebates (Refer to the Budget 2009 rebates here).

Calculating this amount in reverse, that means the Singapore government is actually subsidising $20,000 worth of expenses (2% GST tax) annually. Effectively, the government is actually rolling back the GST tax increase to selective people, mainly Singaporeans. This rebate will depend on how well-off you are, in the government's eyes. Noted that this rebate is only temporary, and not a fixture every year.

For some reason, I've not never seen this mentioned in any news. Of course this might also be an un-intentional reason.

This sort of selective "GST refund" I see arises from 2 main points that were repeatedly brought up by Singaporeans:
  1. Roll-back the 2% GST
  2. Foreigners getting the same benefits as Singaporeans

Rolling back the 2% GST will benefit everyone, including foreigners. Dolling out GST rebates selectively will "hopefully" target the Singaporeans who need it.

Finally, I see some advantages of being a Singaporean. Hopefully this kind of rebates will be a permanent fixture every year. Many of the foreigners see absolutely no reason why they should become a Singaporean, because it makes no difference to them.

Anyway, Happy Chinese New Year everyone. A new year, a new beginning. I hope...

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