TL;DR – Response and more response.
After the Budget was announced, many people have offered many opinions. One such opinion has been circulating around WhatsApp and getting much attention.
Here are the main points that the rant made:
- Why are we still raising GST if we’ve had a budget surplus of S$10 billion last year?
- Giving S$300, which is like bribery, while taking it away with GST is rather meaningless
- Are we spending billions on infrastructure to accommodate the population “target” of 6.9 million, most of whom would be foreigners?
- Why is our defence budget 40% higher than our healthcare budget?
- Why are we giving scholarships to foreigners and only giving bursaries to Singaporeans?
- Instead of raising GST, can’t we raise the tax for high income earners (e.g. Cabinet Ministers)?
Here’s the full Whatsapp message,
Response to the rant
A certain Aloysius came up with a response to that rant. Here are the main points of the response:
1. Why are we still raising GST if we’ve had a budget surplus of S$10 billion last year?
The GST rate will be raised earliest in 2021. It’s announced this year to give people advance notice so that they can be prepared, leverage on the current lower GST and strategize my taxes wherever possible. The surplus last year is a fiscal surplus and not a structural surplus. It is not a surplus that we can expect every year.
2.Giving S$300, which is like bribery, while taking it away with GST is rather meaningless
Would we rather not have that S$300? Besides, the rich, because they buy more things and things that are more expensive, will end up paying more tax compared to the low income when GST is raised. Assuming that the GST hike to fund higher social expenditure is truthful and not being siphoned away by government (now that’s an allegation that you better justify with facts), the hike is inevitable. Incidentally, every dollar that the low income pay in tax, they get $4 back through social transfers, and various other services.
The bonus is literally, a bonus.
3. Are we spending billions on infrastructure to accommodate the population “target” of 6.9 million, most of whom would be foreigners?
The 6.9 million isn’t a target, it’s something that we want to plan to accommodate. Years ago, somehow there’s a gap in planning that caused our roads and public transport system to be over congested today and we are picking up the mess. Our government is just learning from that. And new infrastructure like new airport terminals, ports and industrial clusters are to prevent our economy from stagnating so that young people will get the kind of jobs they aspire to.
4. Why is our defence budget 40% higher than our healthcare budget?
One of the key success behind Singapore is to be able to provide a safe and stable environment for people to live in and businesses to operate in. We have too many red-eyed envious neighbours who are always ready to pounce on us and eat us up. Look at Ukraine vs Russia, Israel vs Palestine, Kuwait vs Iraq. We can’t wait until the threat is imminent then rush to build up our armed forces. By then, it’s already too late.
5. Why are we giving scholarships to foreigners and only giving bursaries to Singaporeans?
Most scholarships require these foreign scholars to at least work 3 years in Singapore. This buys us a chance that they will stay behind and grow their roots. They can supplement our population, slowing down the ageing of our population, delaying the raising of our GST. Many of these scholars could have gone to universities that are as good as, if not better than, our universities. Having them working here and possibly settling down will help us augment our talent pool.
Besides, scholarships and bursaries target different groups of people. Bursaries are for lower income students and their results need not be the top. Foreigners do not even qualify for bursaries. Scholarships are for the students who excel academically.
6. Instead of raising GST, can’t we raise the tax for high income earners (e.g. Cabinet Ministers)?
We tax the rich based on their lifestyle. Such as stamp duties on their property purchases. Many rich man are also big business people, we also leverage on their business success and tax their corporate income, tax the GST. But if simply because I’m rich and you just tax excessively based on my income, then the rich will leave the country with their money and our jobs.
Response to the response
Someone who read the response to the rant commented that we can reduce ministerial salaries, which would free up S$10 million a year for healthcare. Aloysius replied to comments asking to cut ministerial salaries. His main points on the issue of ministerial salaries are:
First, CEO’s of many of the big companies in Singapore (e.g. DBS, OCBC, UOB) earn more than PM. If we don’t pay our ministers well, will we end up with a situation where most the capable people enter the private sector, leaving insufficient talented people to lead the country. Also, if we don’t pay high salaries to our ministers, there is the concern that our ministers may be tempted to dip his hands into the national coffers or have some sideline “business”.
Secondly, the increase in GST rates means we expect to collect about $3.17 billion more in GST revenue. Even if we don’t pay our ministers a single cent, the $10 million is just a rounding error compared to the extra revenue we will get from raising GST.
That same person who asked that we reduce ministerial salaries also compared our politicians salaries to the salaries of politicians in other countries. Well. Aloysius also provided a response to that. He used two examples.
- Donald Trump, $1 a year. The solution to a gun abuse and shootout in school is to give the teachers guns.
- PM of Ukraine, $12,220 a year. He allowed a part of his country be easily Annexed by Russia. He’s the 6th richest in Ukraine with a vested interests in his assets and properties.
Shouldn’t we use those examples as warning of what we would get if we don’t pay our politicians well? Anyway, you can read the full exchange of comments here,
I guess it’s ok for us to disagree on our Budget and other national policies. But we really need to raise our level of debate and discussion.