Friday, February 26, 2010

Relief from income tax

The earned income and wife relief for income tax had remained at $1,000 and $2,000 for the past forty years or longer. If this relief has been adjusted for inflation, it should be $5,000 and $10,000 respectively today.


Anonymous said...

My salary can't keep up with the inflation too.

Anonymous said...

Wife relief shld be $2,000 instead of S$1,000.

Anonymous said...

This $1000 wife relief in income tax has largely meaningless for decades. Has it served any purpose? It's more an insult to a wife.

It has more to reflect our income tax system is not up to date.

Anonymous said...

Dear Mr Tan
That's a good point.

May I suggest you illustrate how this is calculated so that layman like myself can learn how to calculate the effects of inflation for ourselves.

$1,000 inflated over 40 years into $10,000 is a lot of money.

Everlearning said...

Thanks for bringing out this matter. I have always been puzzled why no one takes notice this income tax relief has been stagnant for so long.

chin said...

By taking an average inflation rate of 4% per annum for the last 40 years, $1,000 40 years ago would inflate to approximately $5,000 today.

I think an average 4% per annum for the last 40 years is a reasonable inflation rate for Singapore (considering Sg started out as a third world country, slowly evolved into a developing country with high inflation rate and finally into a "1st world" country with lower rate).

Anonymous said...

shhhhhhh. Keep quiet. Don't let the others know.

C H Yak said...

Basically, the IRAS just tax and tax.

If nothing is provided in the budget by the Minister, and no MPs border to bring up in the subsequent "Committee of Supply" debate but give alot of praises, the reliefs will just stay stagnant for years.

I also could not understand the logic why only one child could claim relief for taking care of their parents, when the Govt is encouraging people to have more babies.

The Govt's approach is basically collecting more tax and giving out less welfare, to the extent of even spending their long "expensive" hours to debate about increasing a few dollars of aid to the poors. Very apathetic.

System is easy (soft system methodology) to collect as much tax for the Govt but leave the complications and burden (hard knocks) for the common poorer people to bear.

Hence, 40 years of inaction & complacency but there is time for these "expensive" people to find time to sing praises for the Minister during the Budget debate. Perhaps their personal logic is that they are also subject to the same taxation system but actually they do not feel a personal pinch like the lower income earners.

Very apathetic thinking at the TOP and this also contribute to the apathy of Singaporean culture.

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