GST bump to 7%

[rottenramone]

..

no easy answers to these questions really. but to wean off the massive dependency off the MNC would be following old nationalist ideals of creating your own and putting it up on the world market.

musicwise it will be:

-have bro empty71 bro to make a guitar with the singapore flag painted on it

-bros blueark bro and bro gsonique bro to make a majulah pedal and a count on me fuzzwah

-have electrico and/or ronin to schedule to play live at national stadium singing chan mali chan and muneru valiba

-bro agingyouth bro to ensure 65,000 paying customers and big money sponsors

-have mediacorp broadcast ala live8

-make it cool and before u know it, japanese schoolgirls will be all over this new crazy Spop culture.

-Spop will contribute at least 7% to Spore's GDP.

 

[snuffleupagus]

I am lost for words bro

 

[rottenramone]

..

The question is does anyone really care about that the govt does with all that extra tax revenue?

other stuff such as defence (i read that NSFs get a lot more now), transport, housing etc etc

the funny thing about govt budget is when you're given a huge amount of money, you will always try and save as much until you have a huge remainder left for the next financial yr.

then when the end of the FY hits, bosses will start spending on unecessary things like stationery, department retreats etc to justify their budget, or else the money will shrink the next time round. :?

 

[Guest]

Hahah, I think that's true for most private entities, not just govt departments.

 

[ahkiatt]

yeah and they reduced rental tax i think for the lower income... so not that bad actually... just try to get as many guitars/drums/pedals before it officially goes to 7%...

and i guess most adults kinda predicted this la... elections earlier this year... tax hikes gotta come soon after... :lol: ... just like the last elections i think? 3% to 5%... timing timing timing. but thank god that sg not that corrupt... otherwise we'd be paying even higher taxes...

 

[blueprintstudios]

expect 10% next probably...

 

[hifi_killer]

babelfish

i disagree here. The lowest income household are least affected, given their propensity to consume is much lower . Besides, if you add up all the benefits they are receiving from the government(eg shares, medical schemes, CPF..) and subtracting away the total amount of tax pay out. You'll find that they're paying "NEGATIVE" tax. Yes that means effectively they're not paying tax at all, but the govt pays them.

If i'm not wrong , only the top few % income bracket pays positive tax.
and the lower income household wont pay a larger proportion of their income, its still 7%, a fixed percentage.

and read today's papers. it specifically pointed out the rationale of the hike in gst in the front page. I think it'll address your concern

 

[Guest]

Argh, sorry I meant regressive tax. It's been years since I looked at a textbook.

The problem about regressive taxes based on consumption is that lower income households tend to spend a bigger proportion of their income on essentials. Higher income households usually have more money left over after spending on essentials and therefore have more room to move in regards to adjusting their consumption, also because the richer you get, the more options you have earning additional income (from shares and investments, paying for fancy tax accountants, etc).

The point I was trying to get at was that given all else remaining constant (i.e. income from government redistribution/contribution remains the same) it's lower income households that end up paying a bigger percentage of their income to the extra 2% GST.

I haven't read the ST (can't get that paper here and too cheap to pay for internet edition) but if the govt uses this extra tax revenue to increase the welfare or subsidies to low income households to offset this then it'd be an equitable result.

 

[Belbel]

Put it in perspective: if you buy a guitar for $500, the extra cost is ten bucks. That is less thna 2 beers in a bar.

Other solution: buy secondhand gear. No GST and cheaper than new.

 

[hifi_killer]

The problem about regressive taxes based on consumption is that lower income households tend to spend a bigger proportion of their income on essentials. Higher income households usually have more money left over after spending on essentials and therefore have more room to move in regards to adjusting their consumption, also because the richer you get, the more options you have earning additional income (from shares and investments, paying for fancy tax accountants, etc).

i get your point but
here you are making the assumption that the propensity to consume for both the rich and the poor are constant. which is not so true. the poor can consume cheaper substitutes as to what the rich consume. Hence the proportion of income spent on essentials may not be significantly larger for the poor.

 

[Guest]

okay, no more economics in a music forum, I promise!!!

Yes, I'm making the standard assumption that all consumer preferences are identical but that still means the marginal propensity to consume increases with disposable income after tax, not before.

And I'll stop here with the stupidtalk.

 

[DoubleDecker]

Damn, how can I describe this best? Let me see... :roll:

Plucking it out of my left pocket ... then feed my penniless right pocket.

Now my left pocket feels empty, I pluck it all out of my right pocket feed it back into my left pocket.

Moral of the story: Ultimately whatever help goes into my left and right pocket is still my own resources.

DD

 

[Stillborn]

and read today's papers. it specifically pointed out the rationale of the hike in gst in the front page. I think it'll address your concern

singapore's media is controlled by the govt...

 

[df]

i get your point but here you are making the assumption that the propensity to consume for both the rich and the poor are constant. which is not so true. the poor can consume cheaper substitutes as to what the rich consume. Hence the proportion of income spent on essentials may not be significantly larger for the poor.

But what ever cheap stuff the poor buys are now becoming more expensive...worst still, their wages are not increasing. So it's definitely gonna affect them more than it would to the rich.

 

[gutturalpiss]

The media is always controlled by the superiors, and most of us choose to b their loyal victims.

It is debatable whether the poor really do benefit frm this gst hike. one can say that with all the so-called benefits they receive from the government, a 2% increase may not b as harmful. Whats more, like how we have always been doing, choose to reflect a lower household income to compensate. however, others including me, think that this is a systematic method of getting rid of the useless. In more formal n mannered terms, this would encourage more ppl to work harder n b more prepared for the challenges faced in this small island city.

However this GST hike is not a sudden news as u all know..Government meetings and rallies have shown us that GST could keep on rising. As a matter of fact, it will. By the time its 10%, i dont know. Unforeseen consequences are best to avoid talking abt.

Some say other countries have it worse. But come to think of it, the homeless in the US own cars. So what if VAT is 12% in some countries? They have other equalisers. U have to calculate gross income, cost of living, standard of living, ownership/buying of assets such as land/vehicles/houses, fmcg & other product costs to name a few. I dont see COE going down, nor interest rates. Even though singapore is too small to house cars, i disagree that lowering the COE would equate to a larger base of lower income families having one. Whats expensive is expensive.

With regards to being a musician, this will definitely have an effect, indirect or direct. But with online purchase being the norm these days, who knows mayb we could shop "internationally"? But what abt content and music creation locally? I dont really know the magnitude of the effect on that. But whatevr it is, before january comes - stock up! :lol:

 

[Vaiyen]

But what ever cheap stuff the poor buys are now becoming more expensive...worst still, their wages are not increasing. So it's definitely gonna affect them more than it would to the rich.

1. assumption that lower income groups' wages not increasing.
2. assumption that higher income groups' will.
3. assumption that there wont be any manueovring in either groups' spending choice.

 

[RoRK]

Governments collect taxes as revenue to finance the running of the country. Another use of taxes is for income re-distribution. The latter is to cater to those who have not benefited from economically due to any number of reasons. This group includes not only the poor but the well-off who may have had a bad year, economically.

Think about the personal income tax as an exmple of how even the well-off benefits from income redistribution practices.

The local government here collects revenue from a variety of sources outside of taxation. This includes profits from the running of a number of mopolies in Singapore and large govrenment linked companies.

Where the monopolies are concerned, it is an economic fact that their prices are far from being low. In essence, Singaporeans have been paying indirect taxes to these monopolies by paying higher than competitive prices for goods and services from these monopolies.

Where GLCs are concerned, should they be part of an industry which is tightly controlled, then it can be easily seen that Singaporeans will also be paying a higher than necessary price for the goods and services.

It is not true to say that the poor in Singapore do not pay taxes or that they receive negative taxes. And even if they do receive negative taxes, it is what any citizen should expect, anywhere else in all developed countries.

The annual revenue from GST collected for the past year is in the neighbourhood of $3 billion. A 40% increase (4%-7%) will mean that an additional revenue of $1 billion is expected.

The government's premise for increasing the GST is to fund programmes for the poor or the less-well off.

We should then expect that $1 billion will be put into programmes for the poor in Singapore.

For the record, Singapore's expenditure on social welfare is negligible and very likely onw of the lowest in the world, to date. Health Care costs are approx. $55 million per annum for the entire population. On a percentage of the annual government budget, Singapore spends about 3-6% on health care. This is one o fthe lowest for devloped countries.

It is also know that we have accumulated reserves of over US$100 billion. No one really knows the true amount. It is also a fact that we have a political party that thinks it is prudent to have a budget surplus each and every year. This goes against any economic theory known to mankind.

In a nutshell, there are better ways of helping the less well-off, or the poor, or the non-elites, in government-speak. Using the reserves or using interest earned from the reserves to set-up programmes for the less fortunate should be a first thought instead of using a hammer to solve a splinter problem. The GST is going to hit the poorest of the poor the hardest. It will disaffect even the middle-income earners.

The economy will take a hit, a slowdown is expect. With the American economy set for a slow-down, as forecasted, the impact of the 40% increase in GST is not going to go down well with the economy as a whole.

Lastly, the government can and should put more money into social welfare for the less-fortunate, including spending a lot more on health care. A first-class country with third-rated budgets for social welfare and health care does not add up; especially one with US$100+ billions in reserves.

 

[df]

But what ever cheap stuff the poor buys are now becoming more expensive...worst still, their wages are not increasing. So it's definitely gonna affect them more than it would to the rich.

1. assumption that lower income groups' wages not increasing.
2. assumption that higher income groups' will.
3. assumption that there wont be any manueovring in either groups' spending choice.

3.

 

[danial]

let's hope jamming prices doesn't increase too :lol:

 

[hifi_killer]

Lastly, the government can and should put more money into social welfare for the less-fortunate, including spending a lot more on health care. A first-class country with third-rated budgets for social welfare and health care does not add up; especially one with US$100+ billions in reserves.

yea i did heard about the huges reserves,theres a name for it forgot whats it called, which only POTROS has the authority to touch it. Its for emergency uses, which is very much debatable...
I guess its not how much you spent that matters or rather how you spend it. If you can afford to spend lesser,promote self dependency and it doesnt compromise health care standards, then why not? Dont we have have the best health care infrastructure and services in the region?
Nevertheless ,the extreme poor has so many channels to turn to for financial assistance, should they need any help. And please take note that the govt alone should not be responsible for our welfare.

I wont say that the poor will get hit the hardest, even if they do, its only for a short term.At this point in time, it is difficult to gauge, how hard the impact on the poor will be, because of several economic, social, psychological factors coming into play. It is not as clear cut as you spend more money, you become poorer.

As for the local media, yes there would be a certain degree of control from up there. But well if you dont like it, the internet is so widely available, you can check out opposition parties websites for their version of 'news' if you think they're more factual. These days, sadly to say theres no such thing as free press anymore. A press that is 100% free from govt control would mean that it is 100% controlled by the market economy. I'm sure we dont want that either.. So we've find a balance, between both.