SINGAPORE, Feb 18 — Singapore has decided to delay a hike in the Goods and Services Tax (GST) to 2023 and stagger the increase over two steps after considering the overall situation that includes the ongoing Covid-19 pandemic.
This was announced by the republic’s Minister of Finance Lawrence Wong when he delivered the Singapore government’s Budget Statement for Financial Year 2022 in Parliament here today.
“Where the timing of GST is concerned, I have carefully considered the overall situation – the ongoing pandemic, the state of our economy, and the outlook for inflation.
“Our revenue needs are pressing. But I also understand the concerns that Singaporeans have about the GST increase taking place at the same time as rising prices,” he said.
Wong said the first increase will take place on January 1, 2023, from 7.0 per cent to 8.0 per cent, and the second increase on January 1, 2024 from 8.0 per cent to 9.0 per cent.
He noted that the revenue from the increase in GST will go towards supporting healthcare expenditure and taking care of senior citizens.
According to the minister, the government will also tax luxury cars at a higher rate to make its vehicle tax system more progressive.
Wong said an additional Additional Registration Fee (ARF) tier will be introduced for cars at a rate of 220 per cent for open market value portion in excess of S$80,000.
The additional ARF is expected to generate an additional $50 million in revenue per year, he said.
— Bernama
