Higher GST looms on the horizon as government seeks new revenue streams

It’s a prime candidate for adjustment, experts say.

After winning a historic election, Singapore’s ruling party is expected to stick to the relatively more populist policies that it has unveiled in recent years.

According to a report by BMI Research, the government will need new revenue streams as it seeks to strengthen social safety nets and increase support for low-income elderly citizens.

“One key area to watch will be the goods and services tax (GST), which has been utilised by the government as a tool to shore up revenue amid declining income and corporate tax rates over the past two decades,” BMI Research said.

“While the recent increase in the top marginal income tax rate will provide some support to the government's annual intake, Singapore's ageing population and the government's growing commitment towards supporting low-income elderly citizens will likely necessitate additional revenue streams, and an increment to the current GST level of 7.0% is a prime candidate for adjustment,” the report added.