Yahoo Finance Singaporeans back higher taxes for the rich to reduce inequality
By Low De Wei
(Bloomberg) —A number of Singapore’s residents support higher taxes on top earners as well as new duties on luxury cars, according to a new poll, backing a government drive to lessen wealth inequalities and build up coffers after the pandemic.
A survey by Blackbox Research showed around two in every five poll respondents “highly favoured” a new budget measure to increase personal income taxes for the top 1% of taxpayers in Singapore and new levies for luxury cars. The poll surveyed 764 people for the two days following Finance Minister Lawrence Wong’s maiden budget presentation in parliament on Feb. 18.
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Public support for taxing the rich underscores a growing fear that social mobility has slowed in Singapore, prompting the government to review its wealth tax system. However, Wong later told a post-budget forum there was “certainly” a limit to taxing the wealthy.
“If we start to have the attitude that most of the tax burden or everything can be borne by the top 1% or the top 5%, I think they will feel it grossly unfair,” Wong said at the event hosted by broadcaster ChannelNewsAsia on Tuesday.
A phased hike in consumption and carbon taxes were the least popular budget measures with just 12% and 19% respectively having a very favorable view of them, according to the survey. These findings indicate the challenge the government faces in implementing broader tax increases that officials have said are necessary to meet long-term health care and environmental needs.
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Wong announced a sharp increase in carbon levies that currently hover at S$5 per ton to S$25 from 2024, and further rises to as much as S$80 by the end of the decade. Other measures like a rise in the goods and services tax were staggered over 2023 and 2024 to avoid compounding already sharp price rises.
Singapore’s core inflation hit a near-decade high in the business hub last month, with surges in energy costs being a key driver, according to data released Wednesday.
While the budget included measures like additional cash payouts to reduce the impact of consumption tax increases, just 16% of respondents told Blackbox that they strongly favoured planned rebates to offset higher electricity prices after a carbon tax increase.
© 2022 Bloomberg L.P.
