More targeted help needed to lighten GST burden

Recently, there has been speculation that the Goods and Services Tax (GST) would be raised to meet increased government spending (GST hike looms as Singapore's funding needs grow; Nov 21).

In the past, the Government chose to lighten the financial burden on lower-income groups by giving out GST vouchers to them.

The distribution of these vouchers should be more targeted.

Currently, it is based on property values. However, I know many reasonably well-to-do Singaporeans who do not need these vouchers, but who choose to live in HDB flats.

The vouchers should be distributed based on per capita income instead, so those who are in real need of such help can benefit.

A two-tier GST mechanism can also be considered.

Higher GST could be levied on non-basic and luxury goods and services. Lower GST could be levied on basic goods and services, such as pre-school education and private healthcare.

It makes no sense to impose higher taxes on necessities.

Jacqueline Lim Cheng Mui (Ms)

A version of this article appeared in the print edition of The Straits Times on November 23, 2017, with the headline 'More targeted help needed to lighten GST burden'. Print Edition | Subscribe