Following the collapse of the Singapore economy due to the Wuhan virus outbreak, Finance Minister Heng Swee Keat announced in his Budget speech yesterday that the government has postponed the 9% GST and not take effect in 2021:
“The coronavirus outbreak is a stark reminder of the continued importance of maintaining a sound fiscal footing to deal with surprises and unexpected scenarios. The GST would remain unchanged next year after reviewing revenue and expenditure projections and considering the state of the economy but we will not be able to put off the increase indefinitely.”
The Deputy Prime Minister who has been earmarked as dictator PM Lee Hsien Loong’s successor added that the government will have a S$6 billion “Assurance Package” to “help the poor and vulnerable”.
As for the permanent GST increase, Minister Heng Swee Keat fired a series of promises, claiming Singaporeans will get cash payouts from S$700 to S$1,600 over five years. This works out to only S$140 to S$320 each year. However, the government will still profit as a Singaporean adult spending S$2,000 each month is expected to pay S$480 more in the increased 2% GST each year.
The PAP minister also claimed that Singaporeans living in one to three rooms flats will get “10 years’ worth” of payouts:
“The Budget’s new Assurance Package means all adult Singaporeans will get cash payouts of between $700 and $1,600 over five years, so most households will get enough to offset at least five years’ worth of additional GST expenses. Those living in one- to three-room flats will get enough to offset about 10 years’ worth. This works out to about $7,000 in GST offsets over five years for a family of four in a four-room flat with a combined income of $6,000. It includes cash of about $4,000.”
Minister Heng Swee Keat refused to cancel the GST increase and confirmed that the PAP government will proceed ahead if it wins the General Election this year.