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Charissa Yong
Monday, Apr 14, 2014

Singapore

Vouchers offset over 90% of GST paid by lower-income households in 2013

The Straits Times | Charissa Yong | Monday, Apr 14, 2014

SINGAPORE - These households also receive benefits in other areas such as education, housing and healthcare which are "far more than the taxes they pay".


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Here is the response by the Ministry of Finance (MOF):

Parliamentary Question by Mr Gerald Giam Yean Song:

To ask the Deputy Prime Minister and Minister for Finance (a) on average, what percentage of GST paid by the lowest 20 per cent of households (by income) is offset by all forms of GST Vouchers last year; and (b) whether the Government will consider fully offsetting the GST paid by all households in the lowest quintile even in years when there are no one-off Special Payments made.

Reply by MOF:

In 2013, for the lowest 20 per cent of households [1], on average about half (49.4 per cent) of their GST paid would have been offset by the regular GST Voucher. If we include the one-off GST Voucher Special Payment announced in Budget 2013, the benefits from the GST Voucher would have covered over 90 per cent of their GST paid.

However, the GST Voucher scheme is not the only offset for the GST paid by lower-income households. The GST Voucher is part of a progressive system of taxes and benefits, that ensures that lower-income households get back far more benefits than the taxes they pay, including GST.

These include childcare subsidies and financial assistance from school to tertiary education, Workfare, special and additional housing grants, and healthcare subsidies. The GST that they pay is far more than offset by the benefits they receive.

[1] Singapore citizen-headed households, ranked by household income per member

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