Why does the Singapore government want to increase taxes on residents?

The Singapore government recently announced the 2023 budget entitled "Join hands to create an era together". Among them, "benefiting the people and developing steadily" is the focus of this year's budget, providing more subsidies to socially disadvantaged groups and low-and middle-income people, and increasing taxes on the rich. 65438+1 October1day, Singapore raised the consumption tax from 7% to 8% for the first time after 15, and plans to further increase it to 9% in 2024.

The increase of consumption tax will inevitably increase the consumption burden of residents. To this end, the Singapore government decided to increase the amount of consumption tax vouchers from the maximum subsidy of S $500 to S $700, and will further increase it to S $850 in 2024. At the same time, special subsidies for living expenses are paid according to the tax situation, ranging from S $200 to S $400. On this basis, the government will also increase the amount of neighborhood shopping vouchers, and each family can get S $300.

In other words, an ordinary family in Singapore can get a maximum of S $65,438 +0.400 and a minimum of S $65,438 +0.200 a year, which is 6,000-7,000 RMB, which can play a very important role in helping residents' family life. Especially in the case of inflation, these subsidies can better alleviate the pressure brought by inflation on residents' lives.

There is also a reason for the Singapore government to do so. 5438+ 10 According to the data released by monetary authority of singapore and the Ministry of Trade and Industry, the overall inflation rate in Singapore in 2022 is 6. 1%. It should be said that the inflation rate is not low. If we don't increase government subsidies to families, the middle and low income groups will face greater pressure on their lives. Obviously, this is not conducive to social stability and residents' harmony, and even affects residents' trust in the government. Therefore, we must make a positive gesture in this regard, so that residents can feel that the government cares about themselves.

It is worth noting that the problem of giving money to residents in Singapore is not "forced" by the government, nor is it that the government finances the whole country. Instead, it solves the problem of giving money to the poor by increasing taxes on the rich. We should know that if we rely solely on the "hard" development of the government, we can only solve it by issuing money when the government has limited financial resources. The result of issuing money is inflation. In the past two years, global inflation has been high, which was caused by the serious currency overshoot in previous years. If we continue to give money to residents, it will be tantamount to digging holes in the flesh to mend sores, robbing Peter to pay Paul, and it has not fundamentally solved the problem.

On the contrary, letting the rich pay more taxes can effectively reduce the burden on the government and solve the problem of giving money to the poor without paying more taxes. The government does not need to issue more money, so it will naturally not increase the currency in circulation and will not trigger new inflation.

Some people think that by raising taxes on the rich to solve the problem of giving money to the poor, it can neither increase the burden on the government, but also better reflect social equity in the distribution of social wealth. However, for the rich, increasing taxes means increasing the burden, which will lead to the decrease of their social wealth. Will this lead to the psychological dissatisfaction of the rich and the idea of immigration? It is unrealistic to say no, however, not many people have this idea. For a considerable number of rich people, immigration has little to do with wealth. Because a moderate tax increase will not have much impact on their wealth. Immigration itself is risky, and once you choose the wrong foothold, you may lose even more.

Judging from the way of tax increase in Singapore, there are some other taxes besides the increase of consumption tax. For example, from February 14, the government will increase the tobacco tax on all tobacco products by 15%, which is expected to bring 1 100 million tax revenue to Singapore; Increase the buyer's stamp duty, the part of the house price of 6.5438 yuan +0.5 million yuan to 3 million yuan (about 7.7 million to 6.5438 yuan+0.542 million yuan) will be raised from 4% to 5%, and the part exceeding 3 million yuan will be raised from 4% to 6%; Additional registration fees for vehicles will also increase. In other words, tobacco tax is a part of the group, and smoking is harmful to health, so raising the tax rate will not cause much repercussions. As for the buyer's stamp duty, only the rich who invest in housing and buy multiple suites pay more taxes, otherwise the tax burden will not increase. Therefore, the rich have no reason not to think so because of tax increases. If you really come up with other ideas, you can also introduce supplementary regulations, such as paying a high tax rate when transferring property, so that the wealth transferred abroad is not so easy or the cost is extremely low.

Singapore's measures of giving money to the poor and raising taxes on the rich are still quite good, which is worth learning from. Under the circumstances of poor economic situation, difficult business operation, heavy employment pressure of residents and slow income growth, a moderate tax increase is feasible and can also be recognized by the rich. The poor who send money will enhance their trust in the government and have a good impression on the rich, thus weakening the contradiction between the rich and the poor.