I am concerned that Prime Minister Lee Hsien Loong is already talking about raising taxes in the near future (Experts expect GST hike within a few years; Nov 21).
I feel that the state of our Budget is not as bad as reported. While the Ministry of Finance projected a budget deficit of $5.62 billion for financial year 2017, this has not taken into consideration contributions from government land sales. When included, it should result in a healthy surplus.
If we come to a time when the state of the Budget worsens, raising taxes may not be the only solution.
Singapore Inc is like a company moving from a high-growth phase to a mature phase. We must accept the reality that Singapore is already a developed economy and government income cannot be expected to grow at the same rate as it has in the last 50 years.
Singapore, like companies in this phase, must adopt new strategies.
First, we should look for new areas of growth to invest in, which the Government has been proactively doing.
Second, we should look to reduce the size of our civil service rather than let it continue to increase.
We should refrain from creating new agencies to tackle problems, but should instead encourage our civil service to increase productivity by doing more with less.
Finally, we have to look to improve the returns generated with our reserves, as we would increasingly need to rely on the investment surplus to fund our budget deficits.
Thus, I hope the Government can consider deferring the plan to raise taxes and look at other ways to balance our Budget.
Yeo Chee Kean