A balancing act – Singapore’s tax policy in a brave new world 

BUDGET 2024 demonstrated the government’s firm focus on providing opportunities and assurance to all of Singapore, and sends a strong message of its commitment to pursuing sustainable growth, maintaining an innovative and vibrant economy while safeguarding what makes the nation resilient.

The ambitious agenda requires a delicate balancing act. Increased spending necessitates more revenue generation, part of which will likely come from additional taxation. However, raising taxes risks damaging Singapore’s global economic competitiveness. The multibillion-dollar question is – how can Singapore strike the right balance while retaining its position as a preferred location for business and talent?

From a policy perspective, the government has made notable changes over the recent years to increase tax revenues fairly and sustainably. For instance, Singapore’s goods and services tax (GST) rate has risen to 9 per cent – a rate that is closer to regional counterparts but still lower than other developed economies. The government has also declared that there are no further plans to raise the GST until 2030.