- Economists say watch for news on e-commerce, estate duties
- Income taxes are less likely to be raised after U.S. cuts
Speculation is buzzing that the Singapore government will raise the goods and services tax in its Feb. 19 budget rollout. But GST probably won’t be the whole story.
Authorities have several other options to increase taxes, or at least signal that they’re needed in the coming years, as the city state grapples with rising health and retirement costs as the population ages rapidly.
Here are a few other measures to watch as the budget is announced:
Economies in the region are just starting to tackle the sticky issue of how to help level the playing field between brick-and-mortar retail and online vendors through a tax on the latter.
While Malaysia, Thailand and Indonesia all have been brainstorming this kind of levy, Singapore may have to move faster, said Chua Hak Bin, a senior economist at Maybank Kim Eng Research in Singapore. That’s because any increase in the GST would give online retailers an even bigger unfair advantage, he said.
Francis Tan, an economist at United Overseas Bank Ltd. in Singapore, sees the same urgency for an e-commerce levy.
“It’s pretty important right now, especially when there’s a growing share — rising at a double-digit pace every year — of Singaporeans shopping online,” he said. “They just have to plug this gap” between taxing online and conventional stores, he said.
Online shoppers in Singapore generally aren’t taxed for their purchases if they don’t exceed S$400 ($300), Indranee Rajah, senior minister of state for law and finance, said in a November interview. Given how quickly online vendors are changing the way people shop, such a tax change should have been achieved “probably yesterday,” she said.
2. Estate tax
Singapore removed the tax on assets for people who died after Feb….