Saturday, January 20, 2007

Problems that Singapore should tackle (I)

There's this problem which Singapore people have sort of mixed feelings towards. That is the problem of raising of GST charges, from the original 5% to 7%. This lead to the general public questioning if this is fair. However, in an article http://news.asiaone.com/a1news/20061113_story4_1.html . It says that this increase would help finance enhanced social safety nets to help lower-income Singaporeans, due to the reason that, GST will usually be charged when consumer purchases stuff, and that with this increase it will also encourages people to save and make prudent investments instead of consumption. However, I feel that this might not necessarily be so.

Yes, by the increase of 2% in the GST charges, people will be more wary of amount of things they buy, and will be more inclined to save then spend. Thus, able to achieve the goals to help the lower income group in Singapore as this will sort of force them to be careful on what are they spending and only buy what they need and not what they want. However, by the implemention of such increase, this may still cause problems for the people. Now, even household everyday stuff will be even more expensive then last time, and that for those family who are extremely poor, for those who are not even able to afford to spend much on their everyday needs, how then will they be able to cope with this increase.

Therefore, perhaps this issue can be looked into for a bit longer, thinking about its pros and cons, finding a way in which it will be satisfactory to the general public. Perhaps, voting can take place or the GST increase will be only for certain items in the market such Ipods, handphone, and that everyday household items can still be charged at 5% GST.

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