ISSUES ON THE INCREASE IN GST
Recently, there has been a lot of talks about the rise of Good Service Tax (GST) from 5% to 7%. The government wants to implement this policy cause they want to use these extra money to help the needy in Singapore. This also increases the offset package which is used for all kinds of reasons such as HDB ungrades, or city, or structural renewal. This new policy which has not been implemented, will be implemented sometime this year. It has practised the principal of pragmatism as Singapore, a fast developing country, needs the extra money to build and improve the whole country and its economy.

The rise in GST sure has its own advantages. It will attend to those with special needs and disabilities, as well as the needy people. The offset package will too benefit the middle-income Singaporeans and will not be based on the housing type alone of a family. The government thinks that this new policy may also help to pull the entire lower income group up in a long run.

However, i do not really agree on the increase of GST. This is because it will create a heavier burden on the middle-income and lower-income group. 7% is quite a lot and not everyone in Singapoere can really afford this increase. It is true that the government wish to use this extra 2% of GST to help the needy, but how much can they afford to help? How far can they reach out to those who are really poor and need the government's help? By increasing the GST, it also causes more people to fall into the lower-income families and need their help. This will be even worse as the government will need to provide for more of the poor people. As for those who do not belong to the lower-income group, it is also very difficult for them to cope with the rise of the living standard in Singapore with the increase of GST. To these group of people, they don't receive the government's help but have to carry this heavy burden with them, making their lives even worse compared to before. I am afraid that even before the entire lower income groups can be pulled up, most of them have not even received the help. Furthermore, how will the government cater to those young people who have just come out to the society? These youngsters would not even have earn much to suppor t for themselves but to pay most of their salary on the GST for the things they buy. It would be even more difficult to rise the standard of living of Singaporeans then.

Although there are many cons on the increase of GST, but it is understandable for the government to implement this new policy. They want to increase Singapore's economy faster and build up the development in Singapore by actually earning from the GST from the tourists. But the greatest impact of this increase still affects the Singaporeans. Thus, i have some suggestions. Instead of increasing the GST for all goods that is sold in Singapore, maybe the government can consider just increasing the GST for certain products such as electronics and at certain places such as resturants and in the airport. These places and things are usually where the tourists will visit and buy when they are in Singapore. In this way, it will not affect most of the Singaporeans and reduce the burden of those middle-income groups. This will only affects those people who can afford the increase, which is usually those richer people who would patronize those high class resturants and buy branded goods. Therefore, this policy would be more beneficial to Singapore as the government would not have to worry that there will be more needy that they will have to attend to, and can use the money for a better purpose. =)

Here are some of the recent articles on the increase of GST:
http://www.channelnewsasia.com/stories/singaporelocalnews/view/254038/1/.html
http://www.channelnewsasia.com/stories/singaporelocalnews/view/255215/1/.html