Personal income tax: Total paid by top 20% doubled in last decade

The top 20 per cent of taxpayers here paid a total of $9.8 billion in personal income tax in the 2017 year of assessment, said Finance Minister Heng Swee Keat yesterday.

This figure is more than double the $4.3 billion collected from these top taxpayers a decade earlier, in the 2007 year of assessment.

In a written reply to a parliamentary question filed by Mr Gan Thiam Poh (Ang Mo Kio GRC), Mr Heng attributed the increase in tax contributions to both a rise in the number of such taxpayers, and higher amounts collected from each of them on average.

He added that this was generally seen across all age groups within the top 20 per cent.

There were about 2.4 million people who had their income assessed last year. Based on figures from the Inland Revenue Authority of Singapore from the 2016 year of assessment, these taxpayers in the top 20 per cent had a chargeable income of more than $80,000.

The 20,877 top earners among them, who had a chargeable income of more than $500,000, contributed $3.7 billion in taxes. They made up just 1.2 per cent of all taxpayers in that year.

Taxation is expected to be a hot issue this year, with Prime Minister Lee Hsien Loong having signalled an impending tax hike.

PM Lee said taxes would need to rise to support growing infrastructure and social spending. Although he did not give details about the taxes that will be raised and when it will happen, some analysts have suggested that the goods and services tax, which is now 7 per cent, could be raised to 8 to 10 per cent.

A version of this article appeared in the print edition of The Straits Times on January 10, 2018, with the headline 'Personal income tax: Total paid by top 20% doubled in last decade'. Print Edition | Subscribe