Singapore GST rise to 9%
- Nov 12, 2019 | Richard Asquith
The Singaporean government has confirmed that it is looking to raise its Goods and Services Tax (GST) rate from 7% to 9% sometime between 2021 and 2025.
The increase is needed to help meet the rising social service costs of an ageing population.
The city-state plans to provide support measures to help the poorest cope with the increase in the consumption tax. This would include a permanent 'GST Voucher' scheme to give discounts on certain basic foodstuffs.
This type of targeted welfare support is viewed as a more effective use of public funding. It is preferential to granting blanket reduced rates on essentials which subsidise the well-off, too. It replicates a similar Consumption Tax discount scheme operated by Japan following this year’s rise in its rate from 8% to 10%. The scheme was only available through small stores, thus helping to boost their businesses at the same time.