Govt to give details of GST support package in Budget 2020, ahead of tax hike in next term: DPM Heng

PM Lee Hsien Loong, DPM Heng Swee Keat and PAP Central Executive Committee members on stage at the start of the PAP65 Awards and Convention on Nov 10, 2019. ST PHOTO: KEVIN LIM

SINGAPORE - Raising the Goods and Services Tax (GST) rate is an unpopular move, and the Government could have waited for the upcoming General Elections to be over before announcing it. But that would not be the honest thing to do, said Deputy Prime Minister Heng Swee Keat.

Mr Heng, speaking on Sunday (Nov 10) at the People's Action Party (PAP) convention at the Singapore Expo, noted that party activists had urged him not to talk about the move anymore, as the elections are coming.

"The responsible thing to do is to be upfront, and tell the people that it will happen. This is what integrity means. We don't hide from difficult truths," said Mr Heng. "If I don't bring it up, the opposition parties definitely will - so it's better that you hear it directly from me."

Mr Heng, who is also the PAP's first assistant secretary-general, said that being upfront in this manner can help Singaporeans and businesses plan ahead for the GST hike, which will go up from 7 to 9 per cent some time between 2021 and 2025.

"You have my commitment that we will help Singaporeans cope with the change," said Mr Heng, who added that the GST Voucher, a permanent scheme, will be enhanced when the GST rate goes up. Details of the GST support package will be announced at next year's Budget, he said.

"More will be given to those with less, because this is fair," said Mr Heng, adding that this is the first time that the Government is announcing the GST support package in advance.

He also stressed that the GST support package is not an 'election goodie', as it will only be given when the GST is increased during the next term of government. But the Government is aware that Singaporeans are concerned given the current economic outlook.

"We want to assure you that there will be help during the transition, so that Singaporeans need not worry or be riled up by the opposition who want to find something to get people to be angry."

He also urged party activists to help explain this measure to Singaporeans, and convince them why a GST increase is necessary.

"Like generations before us, we are taking a bit of pain for the good of our children, and generations to come," he said.


In his speech, Mr Heng also outlined various measures that the PAP's fourth-generation leadership team have introduced to continue investing in and supporting Singaporeans.

The Government is now investing heavily in pre-school, with Minister for Social and Family Development Desmond Lee and Second Minister for Education Indranee Rajah ensuring that there are high-quality, affordable and accessible pre-school options for parents.

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Education Minister Ong Ye Kung is also implementing changes to the Primary School Leaving Examination (PSLE) scoring system, and introducing subject-based banding in all secondary schools, he noted.

In the realm of work, Manpower Minister Josephine Teo is equipping Singaporeans with the skills and confidence to pursue their career aspirations even in the face of setbacks, and the retirement and re-employment ages are also being increased.

Minister for Trade and Industry Chan Chun Sing is driving Singapore's industry transformation and economic restructuring efforts, while labour chief Ng Chee Meng is supporting workers in their transformation journey.

Minister for Communications and Information S Iswaran is also looking at how Singapore can harness digital technology, he added.

"At the same time, we must keep Singapore as a vibrant, connected and liveable home for our people, and an attractive place to do business."

Minister for National Development Lawrence Wong is doing so by developing new areas for work and play such as the Greater Southern Waterfront, while Minister-in-charge of Smart Nation Initiative Vivian Balakrishnan is finding new ways for technology to transform the city.

At the same time, Minister for the Environment and Water Resources Masagos Zulkifli has embarked on zero-waste efforts and is promoting urban farming and renewable energy.

"By investing in our people, growing our economy, and rejuvenating our city, we bring new opportunities for our people to improve their lives."


But with changes and disruptions taking place so quickly, not everyone in Singapore is able to keep pace. "The PAP will not leave anyone behind," Mr Heng said to applause.

In the last few years, the Government has strengthened Singapore's social safety nets, including raising income ceilings for Build-To-Order flats and enhancing housing grants. The Pioneer Generation Package, Merdeka Generation Package have been introduced, while the Community Health Assist Scheme and Workfare have been enhanced to make healthcare even more affordable and help the lowest-paid workers.

The Silver Support package for elderly Singaporeans has also been introduced.

"Our commitment to Singaporeans is that even as we create new opportunities, we will tackle inequality, so that no one will be shut out of opportunities, or left behind by progress," Mr Heng said.

"As long as you are willing to work hard, we will support you to make a better life for yourself and your family. This has been PAP's promise to each generation."

The party also has a duty to future generations, he added, saying this is why it has to make sure there are enough resources for Singaporeans long into the future.

The Straits Times will be providing live coverage as Mr Heng announces the details in Parliament.

There will be livestreaming of his speech and a live blog on our website, as well as a Budget microsite and updates on our Facebook and Twitter accounts.

Readers can also sign up for e-mail updates of the proceedings.

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