GST hike: Open other revenue sources, cut frills

I agree with Mr Tan Yi Han that people might disagree with raising the goods and services tax (GST) (Explore alternatives to lower cost and raise revenue; Nov 23).

There are other ways to raise revenues to delay a GST hike.

According to reports by Credit Suisse Research Institute, Singapore was among the top in Asia in terms of household wealth per adult last year, while the number of millionaires grew by 2 per cent to 150,000.

We could tweak the tax regime towards the rich and raise taxes on betting, luxury goods and tourism.

For example, if each of the 150,000 millionaires pays an additional $8,000 - less than 1 per cent of their income - revenue would increase by over a $1 billion.

We could also cut costs and reduce frills when we spend on our social and economic development and security and external relations. This will lead to considerable savings.

For instance, if we reduce non-critical items by just 3 per cent, it could yield $2.25 billion savings on our $75 billion budget.

Until the world economic outlook improves, it is wise to follow the old saying on money management - open revenue sources and reduce frills.

Paul Chan Poh Hoi

A version of this article appeared in the print edition of The Straits Times on November 30, 2017, with the headline 'GST hike: Open other revenue sources, cut frills'. Print Edition | Subscribe