1
00:00:00,040 --> 00:00:02,259
Speaker 1: this is a C. N. A podcast,

2
00:00:04,240 --> 00:00:08,860
Speaker 1: friday february 18 is when Finance Minister Lawrence Wong will

3
00:00:08,860 --> 00:00:13,550
Speaker 1: unveil Singapore's 2022 budget and a big announcement is expected.

4
00:00:13,560 --> 00:00:16,370
Speaker 1: The raising of our G. S. T. Which currently stands

5
00:00:16,370 --> 00:00:19,470
Speaker 1: at 7% and the GST is somewhat of a lightening

6
00:00:19,470 --> 00:00:22,509
Speaker 1: rod because it's a broad based tax that affects everyone

7
00:00:22,510 --> 00:00:23,950
Speaker 1: rich and poor alike.

8
00:00:24,040 --> 00:00:27,290
Speaker 1: But it's just one tool in the government's revenue kit. Today.

9
00:00:27,290 --> 00:00:28,870
Speaker 1: We want to take a step back and look at

10
00:00:28,870 --> 00:00:32,970
Speaker 1: the broader picture to understand how Singapore's text regime has evolved,

11
00:00:32,979 --> 00:00:36,210
Speaker 1: how the increase the GsC fits in and its effects

12
00:00:36,210 --> 00:00:38,760
Speaker 1: on people, businesses and economy.

13
00:00:41,140 --> 00:00:44,290
Speaker 1: Now with me to unpack what looming tax changes could

14
00:00:44,290 --> 00:00:48,260
Speaker 1: mean for you are Simon Poole, associate professor in practice

15
00:00:48,260 --> 00:00:51,279
Speaker 1: at the N. U. S. Business school. Hello jay Kumar

16
00:00:51,280 --> 00:00:55,330
Speaker 1: head of tax at KPMG Singapore and Terence whole associate

17
00:00:55,330 --> 00:00:57,410
Speaker 1: professor in practice at the lee kuan Yew School of

18
00:00:57,410 --> 00:00:58,520
Speaker 1: Public Policy.

19
00:00:59,040 --> 00:01:01,970
Speaker 1: Um Gentlemen, maybe we can start off by taking a

20
00:01:01,970 --> 00:01:02,660
Speaker 1: look at

21
00:01:02,740 --> 00:01:05,020
Speaker 1: G. S.T. is not a surprise. We know that it

22
00:01:05,020 --> 00:01:07,279
Speaker 1: was always going to be raised. The question was always

23
00:01:07,290 --> 00:01:10,730
Speaker 1: when and the last two years with COVID has sort

24
00:01:10,730 --> 00:01:13,510
Speaker 1: of put a dampener on plan. So my first question

25
00:01:13,510 --> 00:01:18,090
Speaker 1: is the Singapore's strong economic recovery of a projected 3-5%

26
00:01:18,090 --> 00:01:18,850
Speaker 1: this year.

27
00:01:18,940 --> 00:01:21,560
Speaker 1: Make this year the year we bite the bullet to

28
00:01:21,560 --> 00:01:24,510
Speaker 1: raise the Gs. CS, that key factor. What do you think?

29
00:01:24,510 --> 00:01:25,150
Speaker 1: Terrence

30
00:01:25,340 --> 00:01:27,640
Speaker 1: that's what the Prime Minister said, we have to start

31
00:01:27,650 --> 00:01:31,540
Speaker 1: moving on it, there's some urgency to rebuild public finances

32
00:01:31,540 --> 00:01:34,010
Speaker 1: within the term of government. So the real question is

33
00:01:34,010 --> 00:01:35,730
Speaker 1: when it's going to increase and whether it's going to

34
00:01:35,730 --> 00:01:38,039
Speaker 1: be a one step increase or whether it will be

35
00:01:38,040 --> 00:01:40,729
Speaker 1: staggered in two steps, for example, what's your take on,

36
00:01:40,730 --> 00:01:44,149
Speaker 1: which is more likely both are totally valid options.

37
00:01:44,340 --> 00:01:46,680
Speaker 1: If you were left to me, I would stagger it

38
00:01:46,690 --> 00:01:50,550
Speaker 1: even though that mountain pose slightly more administrative costs on businesses,

39
00:01:50,740 --> 00:01:53,320
Speaker 1: but at least it would diffuse the impact on households

40
00:01:53,320 --> 00:01:56,780
Speaker 1: and businesses. Indeed, this year is also a year of

41
00:01:56,780 --> 00:02:00,870
Speaker 1: rising costs of living. We've seen public transport fees, taxi

42
00:02:00,870 --> 00:02:03,660
Speaker 1: heights going up, electricity is also going up to

43
00:02:04,040 --> 00:02:07,060
Speaker 1: what difference does it make if we can postpone G S.

44
00:02:07,060 --> 00:02:10,470
Speaker 1: T for a few more years after all, covid businesses

45
00:02:10,470 --> 00:02:12,390
Speaker 1: and workers are just starting to find out for things.

46
00:02:12,389 --> 00:02:14,810
Speaker 1: What do you think? RG? There are a few dimensions

47
00:02:14,810 --> 00:02:16,480
Speaker 1: to take a look at it. When we are talking

48
00:02:16,480 --> 00:02:18,860
Speaker 1: about GST increase, it's not just about

49
00:02:19,240 --> 00:02:21,730
Speaker 1: looking at what is needed, but it's also looking at

50
00:02:21,730 --> 00:02:25,180
Speaker 1: the fiscal sustainability in the last two years. Singapore's subject

51
00:02:25,180 --> 00:02:26,560
Speaker 1: has shown overall deficit,

52
00:02:26,940 --> 00:02:29,389
Speaker 1: there is never a good time to raise taxes and

53
00:02:29,389 --> 00:02:32,460
Speaker 1: GST certainly is one which is generally a consumption tax,

54
00:02:32,460 --> 00:02:33,470
Speaker 1: a regressive tax,

55
00:02:33,940 --> 00:02:38,180
Speaker 1: but the way Singapore administers it with support for GST vouchers,

56
00:02:38,180 --> 00:02:41,959
Speaker 1: use of vouchers for low income groups, it becomes more progressive,

57
00:02:41,970 --> 00:02:44,760
Speaker 1: it's a good way to deal with it to provide

58
00:02:44,760 --> 00:02:47,740
Speaker 1: for the fiscal sustainability, but at the same time make

59
00:02:47,740 --> 00:02:51,760
Speaker 1: it's not so inequitable for people. So Simon the problem

60
00:02:51,760 --> 00:02:54,840
Speaker 1: also is inflation were being hit all around the world

61
00:02:54,840 --> 00:02:56,859
Speaker 1: and Singapore with rising inflation.

62
00:02:57,139 --> 00:03:01,380
Speaker 1: Doesn't inflation erodes increases in incomes for workers and businesses.

63
00:03:01,380 --> 00:03:03,850
Speaker 1: Is this really the best time? And it's G. S. T.

64
00:03:03,850 --> 00:03:07,510
Speaker 1: Way is not a double whammy? Well certainly inflation is

65
00:03:07,520 --> 00:03:10,330
Speaker 1: a big factor that could affect the timing of the

66
00:03:10,330 --> 00:03:13,200
Speaker 1: GsD height. So when he first started in the window

67
00:03:13,200 --> 00:03:15,650
Speaker 1: period was 20 to 12 to 0 to 5.

68
00:03:15,740 --> 00:03:19,110
Speaker 1: Very quickly narrowed down 2-2-5 for very good reasons

69
00:03:19,340 --> 00:03:23,769
Speaker 1: because of the economic recession moving forward. The window has

70
00:03:23,780 --> 00:03:28,480
Speaker 1: further narrowed. We're looking at three possible dates with the recovery,

71
00:03:28,490 --> 00:03:32,959
Speaker 1: three dates are 1st january 20 to 3. I'm putting

72
00:03:32,960 --> 00:03:36,160
Speaker 1: my bet on this or july this year or april

73
00:03:36,160 --> 00:03:37,460
Speaker 1: this year april is too soon.

74
00:03:37,640 --> 00:03:40,460
Speaker 1: And inflation could be one big factor that could

75
00:03:40,840 --> 00:03:44,520
Speaker 1: influenced the decision because inflation could be a big concern.

76
00:03:44,520 --> 00:03:48,360
Speaker 1: So for that reason the government may just soft understand

77
00:03:48,360 --> 00:03:50,450
Speaker 1: and but I think they will go for first of

78
00:03:50,450 --> 00:03:54,290
Speaker 1: july for various other reasons. What are the reasons. If

79
00:03:54,290 --> 00:03:57,130
Speaker 1: you look at the history of heights the last time

80
00:03:57,130 --> 00:04:00,850
Speaker 1: it increases, it was on july 2007 and

81
00:04:01,040 --> 00:04:02,960
Speaker 1: the announcement was made also in february

82
00:04:03,140 --> 00:04:06,950
Speaker 1: budget. So if history repeats then you're gonna see that happening.

83
00:04:06,960 --> 00:04:10,530
Speaker 1: Another possible reason is because 1st january next year we're

84
00:04:10,530 --> 00:04:15,010
Speaker 1: going to have new GSD rules on imported services for

85
00:04:15,020 --> 00:04:17,570
Speaker 1: non digital services and low value goods. So it may

86
00:04:17,570 --> 00:04:21,240
Speaker 1: be too hard to just handle many changes at one time.

87
00:04:21,250 --> 00:04:22,820
Speaker 1: That could be the reason why they will roll out

88
00:04:22,830 --> 00:04:24,260
Speaker 1: the GSD high first

89
00:04:24,440 --> 00:04:27,860
Speaker 1: maybe in july, but why raise it now? Because last

90
00:04:27,860 --> 00:04:29,990
Speaker 1: year we've also seen reports of how they have been

91
00:04:30,000 --> 00:04:35,180
Speaker 1: healthy contributions from the corporate income tax, property related taxes,

92
00:04:35,180 --> 00:04:37,960
Speaker 1: filling coffers in november just two months ago.

93
00:04:38,140 --> 00:04:41,720
Speaker 1: So if there's also higher tax collections projected, if the

94
00:04:41,720 --> 00:04:44,760
Speaker 1: economy recovers, which is what a lot of experts are saying.

95
00:04:44,839 --> 00:04:48,430
Speaker 1: Why now, given these healthy sources of revenue, why not

96
00:04:48,430 --> 00:04:50,630
Speaker 1: wait and see what do you guys think? It's all

97
00:04:50,630 --> 00:04:52,779
Speaker 1: about looking at what are the short term and the

98
00:04:52,779 --> 00:04:55,839
Speaker 1: long term needs, as we all know, the social and

99
00:04:55,839 --> 00:04:59,580
Speaker 1: the health care spending in Singapore are expected to rise

100
00:04:59,589 --> 00:05:01,969
Speaker 1: in the next few years with the aging population, with

101
00:05:01,970 --> 00:05:04,660
Speaker 1: the demand for the infrastructure and so on and so forth. Right,

102
00:05:05,140 --> 00:05:08,200
Speaker 1: So we certainly have to look for more finances to

103
00:05:08,200 --> 00:05:11,740
Speaker 1: come through to cater for these rising demands. Now, if

104
00:05:11,740 --> 00:05:14,490
Speaker 1: you look at the various forms of taxes, as you

105
00:05:14,490 --> 00:05:17,870
Speaker 1: talked about corporate tax, personal tax today, corporate taxes, the

106
00:05:17,870 --> 00:05:22,890
Speaker 1: highest revenue source for the government followed by Yes, yes,

107
00:05:22,900 --> 00:05:24,400
Speaker 1: and followed by personal tax.

108
00:05:24,839 --> 00:05:28,650
Speaker 1: But if you look at the personal tax component, only 30%

109
00:05:28,650 --> 00:05:32,270
Speaker 1: of the taxpayers individual taxpayers actually contribute the most amount

110
00:05:32,270 --> 00:05:36,310
Speaker 1: of individual tax which is collected by the government. So

111
00:05:36,320 --> 00:05:39,070
Speaker 1: the question is is it going to be sustainable in

112
00:05:39,070 --> 00:05:42,200
Speaker 1: the long run? That's one aspect. The second aspect is

113
00:05:42,200 --> 00:05:43,260
Speaker 1: we need to compare

114
00:05:43,440 --> 00:05:46,160
Speaker 1: our GST rate compared to what is the GST V

115
00:05:46,160 --> 00:05:47,850
Speaker 1: 80 rate in other parts of the world

116
00:05:48,040 --> 00:05:51,140
Speaker 1: Or similar developed economies? Certainly we are one of the

117
00:05:51,140 --> 00:05:53,849
Speaker 1: lower side. Right. If you look at the Viet GST

118
00:05:53,850 --> 00:05:58,260
Speaker 1: rates in Europe, which is hovering around anywhere between 15-20%,,

119
00:05:58,640 --> 00:06:01,050
Speaker 1: we are certainly low G S T. Is one which

120
00:06:01,050 --> 00:06:04,320
Speaker 1: is a consumption based tax, a more stable source of revenue,

121
00:06:04,370 --> 00:06:08,120
Speaker 1: which doesn't kind of fluctuate with the changing economy. So

122
00:06:08,120 --> 00:06:10,940
Speaker 1: it does provide that perspective in terms of providing a

123
00:06:10,940 --> 00:06:13,739
Speaker 1: stable source of revenue to the government to cater for

124
00:06:13,740 --> 00:06:16,059
Speaker 1: the long term needs that are coming through in terms

125
00:06:16,060 --> 00:06:16,360
Speaker 1: of

126
00:06:16,540 --> 00:06:19,660
Speaker 1: the aging population, the infrastructure requirements that I mentioned earlier,

127
00:06:20,040 --> 00:06:22,850
Speaker 1: but put a pin in that because obviously all across

128
00:06:22,850 --> 00:06:25,570
Speaker 1: the world O E C. D countries have definitely have

129
00:06:25,570 --> 00:06:29,520
Speaker 1: a much higher tax to GDP ratio. Even in ASIA

130
00:06:29,520 --> 00:06:32,570
Speaker 1: countries have a 21% tax to GDP ratio. Are you

131
00:06:32,570 --> 00:06:36,550
Speaker 1: saying that higher taxes in Singapore are inevitable given our

132
00:06:36,550 --> 00:06:39,450
Speaker 1: higher social spending on an aging population.

133
00:06:39,540 --> 00:06:43,289
Speaker 1: That's certainly one avenue to look at the other avenue

134
00:06:43,290 --> 00:06:47,230
Speaker 1: is how do you make Singapore even more attractive for

135
00:06:47,240 --> 00:06:49,159
Speaker 1: investments to continue to flow here

136
00:06:49,540 --> 00:06:53,130
Speaker 1: so that our taxpayer base continues to grow because we

137
00:06:53,130 --> 00:06:56,270
Speaker 1: can't just collect higher and higher taxes from the existing

138
00:06:56,270 --> 00:07:01,080
Speaker 1: pool of individuals in the company's. So while these developments

139
00:07:01,080 --> 00:07:04,169
Speaker 1: are happening from a global minimum tax perspective and the

140
00:07:04,170 --> 00:07:05,760
Speaker 1: oecd and web development

141
00:07:05,940 --> 00:07:08,339
Speaker 1: it will be also important to keep in view that

142
00:07:08,339 --> 00:07:10,350
Speaker 1: the tax policy changes are

143
00:07:10,540 --> 00:07:12,920
Speaker 1: made in such a way that Singapore does not lose

144
00:07:12,920 --> 00:07:16,860
Speaker 1: its competitiveness in attracting the right set of companies to

145
00:07:16,860 --> 00:07:20,200
Speaker 1: come and grow here employ the people increase their skill

146
00:07:20,200 --> 00:07:23,270
Speaker 1: set so their level of income also increases and everybody

147
00:07:23,270 --> 00:07:26,480
Speaker 1: can contribute towards the nation building. RJ has raised a

148
00:07:26,480 --> 00:07:29,220
Speaker 1: very interesting point terrance and wanted to get you in

149
00:07:29,220 --> 00:07:30,360
Speaker 1: here just to step back

150
00:07:30,840 --> 00:07:33,810
Speaker 1: what's the larger principle and the design of our tax

151
00:07:33,810 --> 00:07:37,250
Speaker 1: regime because it sounds as if we have higher G. S. T.

152
00:07:37,250 --> 00:07:40,160
Speaker 1: Now because personal income tax and corporate income tax for

153
00:07:40,160 --> 00:07:41,360
Speaker 1: various reasons are

154
00:07:41,740 --> 00:07:45,880
Speaker 1: law and we want to remain attractive to foreign investments

155
00:07:45,890 --> 00:07:48,380
Speaker 1: without eroding work ethic is that the key reason why

156
00:07:48,380 --> 00:07:52,000
Speaker 1: we're moving towards G. S. T. Over along the philosophy

157
00:07:52,000 --> 00:07:54,830
Speaker 1: of tax in Singapore has been to minimize the sort

158
00:07:54,830 --> 00:07:58,710
Speaker 1: of burden on companies and the broad middle income to

159
00:07:58,710 --> 00:08:01,150
Speaker 1: spur enterprise and effort basically and work.

160
00:08:01,340 --> 00:08:04,630
Speaker 1: But over time as the expenditure needs grow of course

161
00:08:04,630 --> 00:08:06,640
Speaker 1: we're going to see a shift towards having to raise

162
00:08:06,640 --> 00:08:09,420
Speaker 1: greater revenue to meet all these expenditure needs and also

163
00:08:09,420 --> 00:08:11,910
Speaker 1: a need for greater redistribution as well. It's going to

164
00:08:11,910 --> 00:08:16,050
Speaker 1: be an evolution rather than revolution. The broad principle still

165
00:08:16,050 --> 00:08:18,350
Speaker 1: remains that the system must be progressive

166
00:08:18,840 --> 00:08:21,150
Speaker 1: and that the mobile health will have to do that part,

167
00:08:21,160 --> 00:08:23,610
Speaker 1: but at the same time everybody must contribute their share

168
00:08:23,620 --> 00:08:25,980
Speaker 1: and as far as possible to keep the burden on

169
00:08:25,980 --> 00:08:28,920
Speaker 1: the broad middle fairly low. But are you saying that

170
00:08:28,920 --> 00:08:31,620
Speaker 1: the tax burden will increasingly fall on the shoulders of

171
00:08:31,620 --> 00:08:35,960
Speaker 1: private citizens rather than businesses? I think it's about equitable distribution.

172
00:08:36,340 --> 00:08:38,239
Speaker 1: So there is of course, as we know, a movement

173
00:08:38,240 --> 00:08:40,360
Speaker 1: towards the global minimum corporate income tax

174
00:08:40,740 --> 00:08:42,980
Speaker 1: and so I think businesses will show the definitely part

175
00:08:42,980 --> 00:08:44,620
Speaker 1: of the tax burden and of course, in Singapore, we

176
00:08:44,620 --> 00:08:47,819
Speaker 1: have the privilege of being able to draw significant revenues

177
00:08:47,820 --> 00:08:49,760
Speaker 1: from the investments on past reserves.

178
00:08:50,140 --> 00:08:53,900
Speaker 1: And then of course, citizens workers and households who have

179
00:08:53,900 --> 00:08:57,030
Speaker 1: to contribute their share as well. Simon throwing this to

180
00:08:57,040 --> 00:09:00,189
Speaker 1: a lot has been said about babs base erosion, profit

181
00:09:00,190 --> 00:09:05,030
Speaker 1: sharing external forces being attributed as the reason why corporate

182
00:09:05,040 --> 00:09:08,630
Speaker 1: income tax and will change and therefore overall tax system

183
00:09:08,640 --> 00:09:11,870
Speaker 1: also has to evolve. Now, when you consider the internal

184
00:09:11,870 --> 00:09:12,660
Speaker 1: domestic

185
00:09:12,940 --> 00:09:16,920
Speaker 1: factors, right? The aging population and rising spending needs? What's

186
00:09:16,920 --> 00:09:19,860
Speaker 1: the proportion of whether external forces or internal forces are

187
00:09:19,860 --> 00:09:21,850
Speaker 1: shaping our tax system overall?

188
00:09:22,240 --> 00:09:26,800
Speaker 1: Certainly your writer, both external forces internal forces will shape

189
00:09:26,809 --> 00:09:30,380
Speaker 1: the decision on the tax system in Singapore. We can't

190
00:09:30,390 --> 00:09:33,980
Speaker 1: ignore international developments in text because Singapore is such a

191
00:09:33,980 --> 00:09:37,310
Speaker 1: small and open economy, we are so affected by our

192
00:09:37,309 --> 00:09:38,859
Speaker 1: major trading partners.

193
00:09:39,040 --> 00:09:41,949
Speaker 1: What's happening in perhaps is that it creates a lot

194
00:09:41,950 --> 00:09:42,760
Speaker 1: of uncertainty

195
00:09:42,940 --> 00:09:46,839
Speaker 1: in terms of whether Singapore's corporate tax revenue will be

196
00:09:46,840 --> 00:09:51,270
Speaker 1: continued to be sustainable. I'm talking about perhaps action point

197
00:09:51,270 --> 00:09:55,630
Speaker 1: to where the proposal for a global minimum tax could

198
00:09:55,640 --> 00:10:00,850
Speaker 1: possibly result in some companies relocating. But that

199
00:10:01,040 --> 00:10:04,120
Speaker 1: is very remote. I'm just saying, what are the opinions

200
00:10:04,130 --> 00:10:04,959
Speaker 1: on the ground?

201
00:10:05,340 --> 00:10:08,280
Speaker 1: What is uncertain is how Singapore as well as the

202
00:10:08,280 --> 00:10:09,970
Speaker 1: rest of the world is going to react to the

203
00:10:09,980 --> 00:10:15,079
Speaker 1: latest implementation details that were just released last month. The

204
00:10:15,080 --> 00:10:17,600
Speaker 1: world is waiting for each other to see how it reacts.

205
00:10:17,610 --> 00:10:20,660
Speaker 1: The Finance Minister is going well.

206
00:10:21,040 --> 00:10:24,500
Speaker 1: The Finance ministers the past as well as the current

207
00:10:24,500 --> 00:10:27,140
Speaker 1: one has indicated that they may need to adjust our

208
00:10:27,140 --> 00:10:30,850
Speaker 1: corporate tax system in response to the implementation. So does

209
00:10:30,850 --> 00:10:32,750
Speaker 1: that mean? Yeah, I think it could mean a lot

210
00:10:32,750 --> 00:10:37,320
Speaker 1: of things. One possibility is that we create two tax systems.

211
00:10:37,330 --> 00:10:40,250
Speaker 1: One is to tax locals and the rest the same

212
00:10:40,250 --> 00:10:41,350
Speaker 1: way as we used to

213
00:10:41,540 --> 00:10:46,089
Speaker 1: giving the smaller enterprises lower effective tax. We've had our

214
00:10:46,090 --> 00:10:50,160
Speaker 1: partial tax exemption system and maybe for the very large

215
00:10:50,170 --> 00:10:53,010
Speaker 1: mm CS that are affected where we could simplify the

216
00:10:53,010 --> 00:10:56,309
Speaker 1: system to meet one possible solution is just to text

217
00:10:56,309 --> 00:10:57,760
Speaker 1: them on the minimum tax

218
00:10:57,940 --> 00:11:01,520
Speaker 1: instead of relinquishing our right to text because if we

219
00:11:01,520 --> 00:11:02,350
Speaker 1: don't text

220
00:11:02,640 --> 00:11:04,460
Speaker 1: Up to the minimum 15%,,

221
00:11:04,840 --> 00:11:07,660
Speaker 1: the tax authorities of the home country will step in

222
00:11:07,660 --> 00:11:09,900
Speaker 1: and have the right to top up the tax. Alright,

223
00:11:09,900 --> 00:11:12,710
Speaker 1: so that's my simple analysis. I just want to dive

224
00:11:12,710 --> 00:11:14,929
Speaker 1: with the Gsc and the effect it will have on

225
00:11:14,929 --> 00:11:17,250
Speaker 1: the economy workers and businesses

226
00:11:17,840 --> 00:11:22,230
Speaker 1: Do. Most businesses simply pass higher GST- two households. And

227
00:11:22,230 --> 00:11:25,640
Speaker 1: is it accurate to say that families, individuals and consumers

228
00:11:25,640 --> 00:11:28,929
Speaker 1: will likely bear the GSD increases rather than businesses? That's

229
00:11:28,929 --> 00:11:31,689
Speaker 1: more likely to be the case because it's a consumption tax.

230
00:11:31,690 --> 00:11:34,740
Speaker 1: So it's actually tax on consumption which eventually is borne

231
00:11:34,740 --> 00:11:35,960
Speaker 1: by the individuals.

232
00:11:36,240 --> 00:11:39,680
Speaker 1: So, businesses are unlikely to get impacted from a financial

233
00:11:39,679 --> 00:11:42,450
Speaker 1: perspective with the increase in GST rate.

234
00:11:42,840 --> 00:11:46,290
Speaker 1: But there could be some businesses which may get an

235
00:11:46,290 --> 00:11:49,380
Speaker 1: impact as well because there are businesses who are not

236
00:11:49,390 --> 00:11:52,230
Speaker 1: able to claim the full input tax credit for the

237
00:11:52,230 --> 00:11:55,240
Speaker 1: GST that they pay. Those businesses could have some impact,

238
00:11:55,250 --> 00:11:58,110
Speaker 1: but by and large businesses are unlikely to get impact.

239
00:11:58,990 --> 00:12:02,790
Speaker 1: For example, even for some of the funds which pay

240
00:12:02,790 --> 00:12:05,130
Speaker 1: the fund management fee to the fund managers we have

241
00:12:05,130 --> 00:12:07,430
Speaker 1: a remission scheme, but that doesn't mean that the funds

242
00:12:07,429 --> 00:12:08,959
Speaker 1: don't absorb any GST.

243
00:12:09,340 --> 00:12:12,870
Speaker 1: So, the financial institutions which actually don't charge GST on

244
00:12:12,870 --> 00:12:15,580
Speaker 1: the services that they provide, but they may encourage GST

245
00:12:15,580 --> 00:12:18,490
Speaker 1: in their input costs, right, Some of those sectors, some

246
00:12:18,490 --> 00:12:20,930
Speaker 1: of those companies can get impacted, but it's going to

247
00:12:20,929 --> 00:12:23,660
Speaker 1: be a small proportion is not going to be the

248
00:12:23,670 --> 00:12:24,850
Speaker 1: majority of them.

249
00:12:25,040 --> 00:12:28,620
Speaker 1: But the key impact for businesses is actually the administrative

250
00:12:28,620 --> 00:12:31,369
Speaker 1: change that they have to put through in their systems,

251
00:12:31,540 --> 00:12:34,750
Speaker 1: in their accounting processes with the increase in the GST

252
00:12:34,750 --> 00:12:37,110
Speaker 1: rate and I think that becomes more of an issue

253
00:12:37,110 --> 00:12:40,040
Speaker 1: from a business perspective, the compliance costs related to it

254
00:12:40,040 --> 00:12:40,960
Speaker 1: and so on and so forth.

255
00:12:41,340 --> 00:12:45,280
Speaker 1: And that's what I expected. Terrence's point exactly you for

256
00:12:45,280 --> 00:12:48,199
Speaker 1: one step or two step, I personally feel that one

257
00:12:48,200 --> 00:12:51,390
Speaker 1: step is better because when you make it staggered when

258
00:12:51,390 --> 00:12:53,809
Speaker 1: you make it a two step process, the businesses have

259
00:12:53,809 --> 00:12:56,930
Speaker 1: to put through those changes to times rather than one time.

260
00:12:56,940 --> 00:13:00,560
Speaker 1: In fact only that certainly only the two steps once

261
00:13:00,740 --> 00:13:02,750
Speaker 1: In 20 or three or 4 when we're coming out

262
00:13:02,750 --> 00:13:04,960
Speaker 1: of the stars and the period of low growth

263
00:13:05,100 --> 00:13:08,960
Speaker 1: that certainly increases the efforts that the businesses need to take.

264
00:13:09,340 --> 00:13:13,309
Speaker 1: And as I said earlier, GST is definitely a regressive

265
00:13:13,309 --> 00:13:16,370
Speaker 1: form of tax but the way it is implemented in Singapore,

266
00:13:16,370 --> 00:13:20,140
Speaker 1: the Finance Minister talked about it yesterday about the support

267
00:13:20,140 --> 00:13:27,960
Speaker 1: that they will provide to the lower income group.

268
00:13:28,040 --> 00:13:29,859
Speaker 1: A lot of people talk about G. S. T. And

269
00:13:29,860 --> 00:13:32,660
Speaker 1: say how that is a sign that our overall tax

270
00:13:32,660 --> 00:13:35,960
Speaker 1: system is not regressive. It's progressive right? Because lower income

271
00:13:35,960 --> 00:13:40,040
Speaker 1: families get handouts. But if that has happened since 2012

272
00:13:40,050 --> 00:13:42,140
Speaker 1: and in fact last year there was a broader base

273
00:13:42,140 --> 00:13:46,400
Speaker 1: because all HDB households got you safe payments last year.

274
00:13:46,410 --> 00:13:50,360
Speaker 1: One that big into expectations and expenditures,

275
00:13:50,440 --> 00:13:54,140
Speaker 1: will it really provide fresh assurances for low income families

276
00:13:54,140 --> 00:13:56,040
Speaker 1: that they will have enough to tide them through Because

277
00:13:56,040 --> 00:13:57,360
Speaker 1: after all, businesses can always

278
00:13:57,440 --> 00:14:00,339
Speaker 1: race course. And we've also seen a lot of places

279
00:14:00,340 --> 00:14:03,970
Speaker 1: like coffee shops that are proactively raising costs already ahead

280
00:14:03,970 --> 00:14:07,650
Speaker 1: of the G S. T increase and in expectation of inflation,

281
00:14:07,660 --> 00:14:09,840
Speaker 1: what do you guys make of that? Maybe I'll just

282
00:14:09,840 --> 00:14:14,760
Speaker 1: give one quick perspective and then Simon and others can cheapen. Yes,

283
00:14:15,240 --> 00:14:17,490
Speaker 1: certainly. I think that is one aspect that needs to

284
00:14:17,490 --> 00:14:21,920
Speaker 1: be managed from a communication perspective from making people understand

285
00:14:21,920 --> 00:14:23,550
Speaker 1: how they pay for GST

286
00:14:23,740 --> 00:14:26,260
Speaker 1: that needs to be definitely dealt with in terms of

287
00:14:26,260 --> 00:14:30,130
Speaker 1: how that is done in terms of implementation, it's a

288
00:14:30,130 --> 00:14:32,880
Speaker 1: broader question of how do you really finance the needs

289
00:14:32,890 --> 00:14:35,660
Speaker 1: that are in front of the government? How many options,

290
00:14:35,660 --> 00:14:36,850
Speaker 1: how many levers that you have?

291
00:14:37,340 --> 00:14:37,850
Speaker 1: Simon?

292
00:14:38,240 --> 00:14:41,370
Speaker 1: I think without any dark GsC is regressive by itself.

293
00:14:41,380 --> 00:14:45,110
Speaker 1: But as RJ pointed out, our Singapore GsC system is

294
00:14:45,110 --> 00:14:49,790
Speaker 1: uniquely different because we have our permanent voucher system and

295
00:14:49,800 --> 00:14:52,290
Speaker 1: the Finance Minister has given the assurance that it will

296
00:14:52,300 --> 00:14:56,090
Speaker 1: be further enhanced. So the big question is whether it

297
00:14:56,090 --> 00:14:56,860
Speaker 1: is enough

298
00:14:56,940 --> 00:14:59,930
Speaker 1: Going by the indicators, the assurance package is going to

299
00:14:59,930 --> 00:15:02,760
Speaker 1: delay the effect of the increase for at least five

300
00:15:02,840 --> 00:15:05,930
Speaker 1: Or 10 years. So the question in the mind of

301
00:15:05,940 --> 00:15:09,050
Speaker 1: the low-income group is probably could more be done to

302
00:15:09,050 --> 00:15:13,750
Speaker 1: really help them in their livelihoods because inflation are real concerns.

303
00:15:13,760 --> 00:15:16,060
Speaker 1: If you hear the ground, there are lot of unhappiness,

304
00:15:16,060 --> 00:15:18,520
Speaker 1: there are a lot of grievances. It would be good

305
00:15:18,520 --> 00:15:21,250
Speaker 1: if the government can do more and reach out to

306
00:15:21,250 --> 00:15:21,950
Speaker 1: the really

307
00:15:22,040 --> 00:15:24,350
Speaker 1: lower income group where they need help the most

308
00:15:24,840 --> 00:15:26,260
Speaker 1: in the near term. Of course we have to be

309
00:15:26,260 --> 00:15:30,030
Speaker 1: alert to profiteering, but eventually, I think businesses will quickly

310
00:15:30,030 --> 00:15:34,060
Speaker 1: settle in equilibrium with competition. Of course, what's notable about

311
00:15:34,060 --> 00:15:36,790
Speaker 1: the offsets is that there will be two components. One

312
00:15:36,790 --> 00:15:39,520
Speaker 1: of course is the assurance package that will be given up.

313
00:15:39,530 --> 00:15:42,780
Speaker 1: The other is a promise to also permanently enhance the

314
00:15:42,790 --> 00:15:44,360
Speaker 1: permanent DST voucher.

315
00:15:44,540 --> 00:15:45,860
Speaker 1: I think that would be significant to

316
00:15:46,140 --> 00:15:49,200
Speaker 1: why because quite often the criticism the past has been

317
00:15:49,200 --> 00:15:53,090
Speaker 1: the support has always been time limited and contingent, whereas

318
00:15:53,100 --> 00:15:56,800
Speaker 1: revenues are always comprehensive and permanent. But with the permanent

319
00:15:56,800 --> 00:15:59,940
Speaker 1: DST voucher is an opportunity to assure the public that

320
00:15:59,950 --> 00:16:02,660
Speaker 1: this is something that lower to middle income households will

321
00:16:02,660 --> 00:16:04,350
Speaker 1: receive on a permanent basis

322
00:16:04,540 --> 00:16:06,850
Speaker 1: wealth taxes is something that has been brought up.

323
00:16:07,240 --> 00:16:10,170
Speaker 1: I just want to go into the whole imperative because

324
00:16:10,180 --> 00:16:15,520
Speaker 1: raising taxes have always cited practical motivations. Government needs revenue

325
00:16:15,520 --> 00:16:17,830
Speaker 1: because there's an aging population. But what do you make

326
00:16:17,830 --> 00:16:21,660
Speaker 1: of this moral imperative that we're hearing in recent months

327
00:16:21,670 --> 00:16:25,090
Speaker 1: of government studying wealth taxes to extract dollars from the

328
00:16:25,090 --> 00:16:26,260
Speaker 1: rich as the quote,

329
00:16:26,440 --> 00:16:30,240
Speaker 1: the affluent should pay their fair share unquote. Those are Lawrence,

330
00:16:30,240 --> 00:16:33,920
Speaker 1: Wong's exact words to fight in quality. Is this a

331
00:16:33,920 --> 00:16:38,160
Speaker 1: shift in Singapore's overall philosophy of which taxes to leverage?

332
00:16:38,540 --> 00:16:41,310
Speaker 1: And should there be a shift seeing also that there

333
00:16:41,310 --> 00:16:45,480
Speaker 1: have been some concerns around inequality, I think Singapore's tax

334
00:16:45,480 --> 00:16:48,920
Speaker 1: system certainly always need to be progressive. So those who

335
00:16:48,930 --> 00:16:51,450
Speaker 1: earn more, those who consume more would need to pay

336
00:16:51,450 --> 00:16:52,970
Speaker 1: more to make it sustainable.

337
00:16:53,440 --> 00:16:56,130
Speaker 1: The question is, is, well, text, the only way to

338
00:16:56,130 --> 00:16:58,870
Speaker 1: do it or it needs to be done more holistically

339
00:16:58,910 --> 00:16:59,970
Speaker 1: to make it progressive

340
00:17:00,440 --> 00:17:02,960
Speaker 1: Wealth tax is certainly one option, but I think we

341
00:17:02,960 --> 00:17:05,580
Speaker 1: need to look at in the context of the kind

342
00:17:05,580 --> 00:17:08,859
Speaker 1: of wealth which has been developing in Singapore in the

343
00:17:08,859 --> 00:17:10,270
Speaker 1: last 5 to 10 years

344
00:17:10,640 --> 00:17:13,679
Speaker 1: and a lot of wealth has come into Singapore, which

345
00:17:13,680 --> 00:17:16,000
Speaker 1: is actually a portable wealth with the influx of foreign

346
00:17:16,000 --> 00:17:20,410
Speaker 1: managers with family offices. So a broad brush wealth tax,

347
00:17:20,510 --> 00:17:24,090
Speaker 1: is that investment or wealth? It's a combination of both.

348
00:17:24,100 --> 00:17:26,630
Speaker 1: If you look at family offices particularly who have been

349
00:17:26,630 --> 00:17:31,159
Speaker 1: anchoring themselves here in light of our practical tax system,

350
00:17:31,170 --> 00:17:33,869
Speaker 1: they could actually feel jittery if a wealth tax broad

351
00:17:33,869 --> 00:17:35,959
Speaker 1: brush basis is implemented.

352
00:17:36,340 --> 00:17:38,810
Speaker 1: So a broad brush, well, tax could be tricky from

353
00:17:38,810 --> 00:17:42,580
Speaker 1: a Singapore's position as an asset management and wealth management hub,

354
00:17:42,590 --> 00:17:47,270
Speaker 1: but certainly there could be opportunities to bring progressivity in

355
00:17:47,270 --> 00:17:49,690
Speaker 1: the tax system, which has been done in terms of

356
00:17:49,690 --> 00:17:53,670
Speaker 1: stamp duty more a BSD when people are buying more properties,

357
00:17:53,680 --> 00:17:55,450
Speaker 1: property tax and so on and so forth.

358
00:17:55,740 --> 00:17:58,570
Speaker 1: But there could be room for looking at things like

359
00:17:58,580 --> 00:18:01,800
Speaker 1: taxing higher stamp duty on the number of properties, but

360
00:18:01,800 --> 00:18:04,129
Speaker 1: look at the value as well. So the basic stamp

361
00:18:04,130 --> 00:18:06,990
Speaker 1: duty which is currently paid at three or 4% is

362
00:18:06,990 --> 00:18:09,640
Speaker 1: just on the first property, irrespective of the value of

363
00:18:09,640 --> 00:18:11,310
Speaker 1: the property that you buy, even if it's a good

364
00:18:11,310 --> 00:18:13,770
Speaker 1: class bungalow, you're paying the same amount of property. But

365
00:18:14,240 --> 00:18:16,420
Speaker 1: those could be opportunities to look at as to how

366
00:18:16,420 --> 00:18:19,960
Speaker 1: to make it progressive rather than a broad brush wealth tax,

367
00:18:19,970 --> 00:18:23,330
Speaker 1: which could be seen in a slightly negative connotation in

368
00:18:23,330 --> 00:18:26,230
Speaker 1: terms of the rising wealth in Singapore. With the influx

369
00:18:26,230 --> 00:18:29,280
Speaker 1: of fund managers, family offices and other people migrating their

370
00:18:29,280 --> 00:18:30,170
Speaker 1: wealth in Singapore

371
00:18:30,240 --> 00:18:32,950
Speaker 1: Simon, do you think it's clear who the wealthy are

372
00:18:32,950 --> 00:18:35,290
Speaker 1: and therefore who we should text when it comes to

373
00:18:35,290 --> 00:18:36,450
Speaker 1: a wealth tax,

374
00:18:36,940 --> 00:18:40,260
Speaker 1: a good proxy will be those individuals who buy good

375
00:18:40,270 --> 00:18:42,920
Speaker 1: grass plant growth. I have nothing against them, but this

376
00:18:42,920 --> 00:18:46,100
Speaker 1: will be a good indication that they can afford to

377
00:18:46,109 --> 00:18:50,780
Speaker 1: pay very high prices for the Bangles and consequently there

378
00:18:50,780 --> 00:18:53,459
Speaker 1: is scope for them to pay a little bit more.

379
00:18:53,840 --> 00:18:56,730
Speaker 1: So we talked so much about the progressivity and no

380
00:18:56,740 --> 00:18:59,960
Speaker 1: tax system will not take that into account in their system.

381
00:18:59,970 --> 00:19:02,550
Speaker 1: It's a question of how progressive we are. We have

382
00:19:02,560 --> 00:19:05,900
Speaker 1: been striving for a progressive tax system that is not

383
00:19:05,900 --> 00:19:09,780
Speaker 1: only sustainable, but also seen to be fair across all

384
00:19:09,780 --> 00:19:14,560
Speaker 1: different tax types as well as all individuals and businesses.

385
00:19:14,640 --> 00:19:17,179
Speaker 1: I think the strategy is to focus on all areas

386
00:19:17,180 --> 00:19:20,400
Speaker 1: of taxes, not just on income tax. GST wealth tax

387
00:19:20,400 --> 00:19:23,560
Speaker 1: has always been implemented. It's just a question of what

388
00:19:23,570 --> 00:19:26,919
Speaker 1: form it takes. So the government has opted for the

389
00:19:26,930 --> 00:19:29,740
Speaker 1: easier way. If I may say it, because it is

390
00:19:29,750 --> 00:19:33,450
Speaker 1: easy to text the individuals who buy properties

391
00:19:33,540 --> 00:19:36,660
Speaker 1: and they can't shift their properties away from Singapore and

392
00:19:36,660 --> 00:19:39,670
Speaker 1: to another country easily. Unlike the real wealth text where

393
00:19:39,670 --> 00:19:40,670
Speaker 1: it is very hard

394
00:19:40,840 --> 00:19:44,850
Speaker 1: to collect the taxes on the net wealth, it involves

395
00:19:44,850 --> 00:19:47,480
Speaker 1: a lot of work determining how much is the net

396
00:19:47,480 --> 00:19:50,359
Speaker 1: wealth and certainly I believe the government is not going

397
00:19:50,359 --> 00:19:53,130
Speaker 1: through that route because it may not be cost effective.

398
00:19:53,140 --> 00:19:55,609
Speaker 1: It takes a lot of resources to implement such a

399
00:19:55,609 --> 00:19:59,990
Speaker 1: complicated system, drawing from the experience from other countries, but

400
00:19:59,990 --> 00:20:02,709
Speaker 1: why is wealth taxes making a return to Singapore? Because

401
00:20:02,710 --> 00:20:05,120
Speaker 1: like you say, there are a lot of issues with

402
00:20:05,130 --> 00:20:08,580
Speaker 1: compliance leakages and the wealthy can just up and go

403
00:20:08,590 --> 00:20:10,830
Speaker 1: to the middle class best. The brunt of it. The

404
00:20:10,830 --> 00:20:15,270
Speaker 1: wealthy can afford accountants creating accounting. So, why this change

405
00:20:15,270 --> 00:20:17,670
Speaker 1: of heart, I think to be fair to talk about

406
00:20:17,670 --> 00:20:21,450
Speaker 1: the inequality has always been there. Maybe we are witnessing

407
00:20:21,460 --> 00:20:23,560
Speaker 1: an increase in the conversation.

408
00:20:23,640 --> 00:20:25,860
Speaker 1: I think we find that happening each time

409
00:20:25,940 --> 00:20:29,600
Speaker 1: the budget comes near. So it's not new. The concerns

410
00:20:29,609 --> 00:20:32,629
Speaker 1: are genuine and certainly the government is paying heed to

411
00:20:32,630 --> 00:20:35,910
Speaker 1: that and seeing what they can do to narrow down

412
00:20:35,910 --> 00:20:39,850
Speaker 1: the income or wealth care inequality is also not just

413
00:20:39,859 --> 00:20:43,730
Speaker 1: on income but also on wealth. So increasingly they are

414
00:20:43,740 --> 00:20:46,270
Speaker 1: revealing the wealth tax system to see whether

415
00:20:46,340 --> 00:20:49,310
Speaker 1: They can make further tweaks to our system. Maybe I

416
00:20:49,310 --> 00:20:51,050
Speaker 1: could also add to that. I think the past 10

417
00:20:51,050 --> 00:20:53,480
Speaker 1: years since the onset of the global financial crisis has

418
00:20:53,480 --> 00:20:56,379
Speaker 1: seen a huge search, also an asset prices, whether it's

419
00:20:56,380 --> 00:20:59,270
Speaker 1: property or financial assets because of the flood of liquidity

420
00:20:59,270 --> 00:21:01,730
Speaker 1: that has been introduced in the global system. So that

421
00:21:01,730 --> 00:21:04,760
Speaker 1: also adds for the impetus to act on the Wealthfront

422
00:21:05,440 --> 00:21:07,990
Speaker 1: and Singapore has become affluent over so many years, the

423
00:21:07,990 --> 00:21:10,879
Speaker 1: passing down of property and assets could lead to the

424
00:21:10,880 --> 00:21:13,899
Speaker 1: risk of society stratify ng if they're not a countervailing

425
00:21:13,900 --> 00:21:18,790
Speaker 1: measures to improve equality, but one that hurt job creation investments.

426
00:21:18,800 --> 00:21:20,940
Speaker 1: That's often been like said to be one of the

427
00:21:20,940 --> 00:21:22,960
Speaker 1: reasons why we're against wealth taxes right?

428
00:21:23,140 --> 00:21:25,610
Speaker 1: It's about balance. As I mentioned, I think it's about

429
00:21:25,609 --> 00:21:28,610
Speaker 1: evolution rather than revolution. I don't expect that there could

430
00:21:28,609 --> 00:21:32,130
Speaker 1: be really massive changes. That's what RJ has said, capital

431
00:21:32,130 --> 00:21:34,790
Speaker 1: is also mobile, but on the other hand, if there's

432
00:21:34,790 --> 00:21:37,500
Speaker 1: too much of just wealth inheritance rather than work. It

433
00:21:37,500 --> 00:21:40,090
Speaker 1: could work in the opposite direction to promoting effort and

434
00:21:40,090 --> 00:21:43,619
Speaker 1: enterprise society, this shift of this change in motivation to

435
00:21:43,619 --> 00:21:47,010
Speaker 1: tax the rich to ensure greater equality. As a change,

436
00:21:47,020 --> 00:21:48,159
Speaker 1: it's not revolution,

437
00:21:48,440 --> 00:21:50,970
Speaker 1: The system has always tried to be progressive and in fact,

438
00:21:50,970 --> 00:21:53,020
Speaker 1: that's one of the core principles. And as early as

439
00:21:53,020 --> 00:21:56,280
Speaker 1: budget 2010, there were already tears in terms of unoccupied

440
00:21:56,280 --> 00:21:58,270
Speaker 1: property being progressive.

441
00:21:58,440 --> 00:22:00,650
Speaker 1: So this is not new, but it's a question of

442
00:22:00,660 --> 00:22:03,199
Speaker 1: leaning against the wind in terms of the increase in

443
00:22:03,200 --> 00:22:06,750
Speaker 1: wealth inequality throughout the world, including in Singapore since 2010.

444
00:22:06,760 --> 00:22:09,889
Speaker 1: And the idea that now that our expenditure needs have

445
00:22:09,890 --> 00:22:12,700
Speaker 1: grown to how each segment of society has put in

446
00:22:12,700 --> 00:22:15,270
Speaker 1: the fresh air at the same time without causing

447
00:22:15,440 --> 00:22:18,030
Speaker 1: a massive disruption to the system and having wealth and

448
00:22:18,030 --> 00:22:19,270
Speaker 1: capital flee Singapore.

449
00:22:19,540 --> 00:22:21,540
Speaker 1: But of course the other elephant in the room is

450
00:22:21,540 --> 00:22:25,410
Speaker 1: the personal income taxes. It's the highest grossing revenue source

451
00:22:25,420 --> 00:22:29,780
Speaker 1: after GSC and after corporate income tax last financial year,

452
00:22:29,790 --> 00:22:33,330
Speaker 1: would you all rule out increases to personal income taxes

453
00:22:33,330 --> 00:22:34,560
Speaker 1: to raise taxes?

454
00:22:34,640 --> 00:22:38,430
Speaker 1: I think our personal income tax innovate is already progressive

455
00:22:38,440 --> 00:22:41,450
Speaker 1: because it's not a flat rate of tax, it progresses

456
00:22:41,450 --> 00:22:43,460
Speaker 1: from zero all the way to 22%.

457
00:22:43,940 --> 00:22:46,899
Speaker 1: So those who earn more pay more income tax, if

458
00:22:46,900 --> 00:22:49,550
Speaker 1: you look at the highest rate, which is 22% is

459
00:22:49,550 --> 00:22:53,169
Speaker 1: quite high already. In fact, I personally believe that that

460
00:22:53,180 --> 00:22:56,150
Speaker 1: increasing the personal tax higher from here could be more

461
00:22:56,150 --> 00:22:59,820
Speaker 1: tricky compared to looking at areas like GST or making

462
00:22:59,830 --> 00:23:02,699
Speaker 1: more changes in the broader wealth tax regime that we

463
00:23:02,700 --> 00:23:03,560
Speaker 1: have around

464
00:23:03,740 --> 00:23:06,270
Speaker 1: property tax and stamp duty and so on and so forth,

465
00:23:06,640 --> 00:23:12,010
Speaker 1: because our personal income taxes not only applicable to locals,

466
00:23:12,010 --> 00:23:14,930
Speaker 1: but it's also applicable equally to the foreigners who come

467
00:23:14,930 --> 00:23:17,639
Speaker 1: and live here. And we have a large number of

468
00:23:17,640 --> 00:23:20,770
Speaker 1: such expect population which come because of the investments which

469
00:23:20,770 --> 00:23:23,530
Speaker 1: the MNCS make. So that's from that perspective is what

470
00:23:23,530 --> 00:23:24,670
Speaker 1: I'm trying to indicate.

471
00:23:24,940 --> 00:23:26,990
Speaker 1: I think on the wealth tax, I would say it's

472
00:23:26,990 --> 00:23:30,030
Speaker 1: not something which is a topic which is unique in Singapore,

473
00:23:30,030 --> 00:23:32,460
Speaker 1: which has come up for discussion is probably

474
00:23:32,640 --> 00:23:35,820
Speaker 1: happening in many parts of the world because the trends

475
00:23:35,820 --> 00:23:39,280
Speaker 1: which have come about post global financial crisis is pretty

476
00:23:39,280 --> 00:23:42,880
Speaker 1: similar in many countries around the world. Many countries around

477
00:23:42,880 --> 00:23:44,630
Speaker 1: the world have actually dipped into a lot of the

478
00:23:44,630 --> 00:23:48,119
Speaker 1: reserves to provide support to companies, individuals during covid time.

479
00:23:48,119 --> 00:23:50,170
Speaker 1: That's one of the trigger factor as well. In terms

480
00:23:50,170 --> 00:23:51,960
Speaker 1: of thinking about, okay, how do we

481
00:23:52,240 --> 00:23:55,060
Speaker 1: bring back the fiscal sustainability and what are the different

482
00:23:55,060 --> 00:23:57,820
Speaker 1: levers that we can pull to make it happen? Well,

483
00:23:57,820 --> 00:24:00,230
Speaker 1: taxed certainly has come up as a discussion point in

484
00:24:00,230 --> 00:24:02,990
Speaker 1: other countries as well. But for Singapore, I think what

485
00:24:02,990 --> 00:24:05,500
Speaker 1: will be important is again, as I mentioned earlier, not

486
00:24:05,500 --> 00:24:07,420
Speaker 1: to think about it is in a broad brush well

487
00:24:07,420 --> 00:24:11,240
Speaker 1: tax context, but see how to implement or tweet policies

488
00:24:11,240 --> 00:24:13,820
Speaker 1: in a way where those who can afford to pay more,

489
00:24:13,830 --> 00:24:16,859
Speaker 1: pay more and make it more fair and equitable system

490
00:24:16,940 --> 00:24:19,930
Speaker 1: last question and in discussion about the changes to the

491
00:24:19,930 --> 00:24:22,980
Speaker 1: tax system, where do you see carbon taxes, are these

492
00:24:22,980 --> 00:24:24,890
Speaker 1: sort of like a vice kind of text like we

493
00:24:24,890 --> 00:24:28,320
Speaker 1: have on cigarettes and alcohol and how will this impact

494
00:24:28,330 --> 00:24:31,720
Speaker 1: businesses across the board? I think it's really about sending

495
00:24:31,720 --> 00:24:34,500
Speaker 1: the right price signal, especially if you're trying to transition

496
00:24:34,500 --> 00:24:36,770
Speaker 1: towards a lower carbon economy,

497
00:24:37,060 --> 00:24:40,230
Speaker 1: it's about providing the right incentives to change behaviors, both

498
00:24:40,230 --> 00:24:40,860
Speaker 1: on the part of

499
00:24:40,940 --> 00:24:43,920
Speaker 1: Corporates as well as consumers. So I wouldn't say it's

500
00:24:43,920 --> 00:24:46,690
Speaker 1: so much of advice tax, but something that is structurally

501
00:24:46,690 --> 00:24:49,060
Speaker 1: needed for future green economy,

502
00:24:49,540 --> 00:24:51,840
Speaker 1: the center right press signals. I think carbon tax is

503
00:24:51,840 --> 00:24:54,400
Speaker 1: unlikely to be a source of revenue for the government.

504
00:24:54,410 --> 00:24:57,520
Speaker 1: It's more likely to be a message, a signal to

505
00:24:57,520 --> 00:25:00,359
Speaker 1: change the behavior and a lot of revenue that is

506
00:25:00,359 --> 00:25:02,480
Speaker 1: collected through carbon tax is likely to go back to

507
00:25:02,480 --> 00:25:06,040
Speaker 1: the businesses to help them transform into cleaner solutions. But

508
00:25:06,040 --> 00:25:08,440
Speaker 1: having said that, I think are carbon tax rate currently

509
00:25:08,440 --> 00:25:09,159
Speaker 1: which is

510
00:25:09,340 --> 00:25:11,859
Speaker 1: $5 is quite low compared to what

511
00:25:12,240 --> 00:25:14,550
Speaker 1: is actually being seen in other parts of the world,

512
00:25:14,550 --> 00:25:17,540
Speaker 1: particularly in europe, where it is much, much higher, so

513
00:25:17,540 --> 00:25:20,340
Speaker 1: there is certainly a room to increase that so that

514
00:25:20,340 --> 00:25:23,109
Speaker 1: you get the right signal which was already being mentioned

515
00:25:23,109 --> 00:25:25,760
Speaker 1: in the previous budget and then see how that needs

516
00:25:25,760 --> 00:25:29,960
Speaker 1: to be channeled back to businesses and to individuals who

517
00:25:29,960 --> 00:25:31,260
Speaker 1: may also get higher

518
00:25:31,340 --> 00:25:33,139
Speaker 1: impact with the higher carbon tax.

519
00:25:33,340 --> 00:25:36,879
Speaker 1: Yeah, certainly I echo the comments by Terrence Energy, it

520
00:25:36,880 --> 00:25:40,950
Speaker 1: is not for income generation, it is for the purpose

521
00:25:40,950 --> 00:25:44,090
Speaker 1: of noble cause and Singapore is not alone in its

522
00:25:44,090 --> 00:25:46,859
Speaker 1: fight against climate change and all that. So we are

523
00:25:46,859 --> 00:25:49,740
Speaker 1: playing our part and the scope to increase the rates

524
00:25:49,750 --> 00:25:52,640
Speaker 1: a little bit more, we cannot be too high because

525
00:25:52,640 --> 00:25:53,050
Speaker 1: it will

526
00:25:53,220 --> 00:25:54,270
Speaker 1: affect the

527
00:25:54,340 --> 00:26:00,260
Speaker 1: competitiveness of certain industries. Thank you Simon Terrence RJ. Now

528
00:26:00,260 --> 00:26:03,990
Speaker 1: Singapore's 2022 budget will be delivered live on february 18

529
00:26:03,990 --> 00:26:05,169
Speaker 1: 3 30 pm

530
00:26:07,440 --> 00:26:10,430
Speaker 1: if you like this episode, I want to hear others

531
00:26:10,440 --> 00:26:13,080
Speaker 1: follow us on your favorite podcast app, you'll be able

532
00:26:13,080 --> 00:26:15,480
Speaker 1: to catch up on hardly matter episodes like the one

533
00:26:15,480 --> 00:26:19,120
Speaker 1: on one interview with grab Singapore, Managing Director uB Tank,

534
00:26:19,130 --> 00:26:21,470
Speaker 1: we put in the hot seat on giving food deliverers

535
00:26:21,480 --> 00:26:22,670
Speaker 1: full time jobs

536
00:26:22,840 --> 00:26:26,060
Speaker 1: and our conversation with HR experts on why workers seem

537
00:26:26,060 --> 00:26:29,860
Speaker 1: to be languishing amid a great resignation wave Until next week,

538
00:26:29,859 --> 00:26:33,280
Speaker 1: I'm lyn selling with Christina robert, our podcast editor and

539
00:26:33,280 --> 00:26:35,350
Speaker 1: Aaron Lower research writer signing off