To appease Singaporeans’ rage about the lifetime 9% GST increase, the Singapore government will be giving an one-off cash voucher between S$100 to S$300 to each Singaporean. Finance Minister Heng Swee Keat praised his government for the generosity describing the cash payout as a “hongbao” for Singaporeans:
“This hongbao reflects the Government’s long-standing commitment to share the fruits of Singapore’s development with Singaporeans.”
Costing S$700 million, Singaporeans aged 21 and above with an annual income of S$28,000 or below will be eligible for a payout of S$300, those whose income is S$28,001-S$100,000 will receive S$200, and people whose income is in excess of S$100,000 will receive S$100.
However, a 2% GST increase for the average Singaporean spending S$28,000 a year is a S$560 increase in taxes, compared to the S$300 he will receive as “hongbao”. The “hongbao” also excludes other tax increases like 30% water price increase, and the corresponding increase in cost of living due to the GST tax increase.
The GST increase will be implemented by 2021, a year after the 2020 General Election which is expected to see anther PAP landslide win.