The government reduced income tax and introduced GST two decades ago with the aim of attracting high income earners to come to Singapore.
The aim was to tax revenue from these super rich immigrants, although at a low rate of tax. It is better than getting nothing from them.
It did not happen. Why?
Most of the income of these super rich immigrants were overseas income and were exempted from income tax.
So, we are the winners and losers in this tax regime?
The winners are the high income earners - lawyers, doctors, bankers, property developers, corporate executives, politicians - who earn several million in income from local sources, and pay a low rate of income tax.
There is virtually no risk that high income rates will get these high earners to leave Singapore. They cannot run away because their income are from local sources. They cannot earn these income in other countries.
The losers are clearly the ordinary people who have to shoulder a large burden of the tax through GST.
A high income tax rate will allow GST to be removed and will reduce the cost of living. It will help to reduce the high level of inequality in Singapore.
The aim was to tax revenue from these super rich immigrants, although at a low rate of tax. It is better than getting nothing from them.
It did not happen. Why?
Most of the income of these super rich immigrants were overseas income and were exempted from income tax.
So, we are the winners and losers in this tax regime?
The winners are the high income earners - lawyers, doctors, bankers, property developers, corporate executives, politicians - who earn several million in income from local sources, and pay a low rate of income tax.
There is virtually no risk that high income rates will get these high earners to leave Singapore. They cannot run away because their income are from local sources. They cannot earn these income in other countries.
The losers are clearly the ordinary people who have to shoulder a large burden of the tax through GST.
A high income tax rate will allow GST to be removed and will reduce the cost of living. It will help to reduce the high level of inequality in Singapore.
No comments:
Post a Comment