Following an expected S$75 billion deficit accumulated over the past two years, which required the Government to tap the reserves for fiscal firepower amid the Covid-19 pandemic, Budget 2022 could return to a modest surplus position, several economists predicted over the past week.
He added: “We aim to forge a fairer, more inclusive and a greener home for us and our future generations — so that all of us can continue to be proud to call Singapore our home. The additional revenues generated by the GST increase will be used to fund recurrent expenses, such as the expansion of healthcare and support schemes for older Singaporeans.
“Giving a longer notice period before the increase is effected will help businesses to prepare for and cope with the increase,” he said.To defray the impact of the GST increase further and to help lower-income families manage costs of living, the Government could announce more support measures, as it did in past GST increases in 2003, 2004 and 2007.
The current GST Voucher scheme — introduced in 2012 and comes in the form of cash, MediSave and U-Save — will likely be enhanced when the GST rate is raised.The Progressive Wage Model could also be extended to more sectors. Mr Lee announced in his 2021 National Day Rally that the scheme, which seeks to raise wages of workers through upgrading skills and improving productivity, will be extended to “many more workers”.
Previously, the Government said the carbon price would rise to between S$10 and S$15 per tonne by 2030. In comparison, Sweden has the highest rate in the world at around S$170 per tonne, while the European Union currently charges around S$120 per tonne of carbon dioxide emissions. Mr Lam from SBF said sustainability is one of the biggest untapped business opportunities in Singapore today.
Property taxes, especially on luxury homes on the highest end, could also be instituted, though there were already recent property cooling measures announced in December. Last year, 136 countries who are part of the project by the Organization for Economic Co-operation and Development, including Singapore, have agreed to set a 15 per cent minimum multinational corporate tax rate from 2023.
The Jobs Growth Incentive is a scheme introduced in 2020 to spur employers to hire locals by providing salary support to eligible companies and employees, and it expires in March 2022.
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