With next GST hike looming, businesses found guilty of profiteering must be taken to task

IT IS just a little over a month before Singapore’s Goods and Services Tax (GST) goes up once again. On the first day of 2024, the consumption tax will be hiked to 9 per cent, the second of a two-step rate increase that began on Jan 1 this year. In the current environment of persistently stubborn inflation and an unprecedented rise in the cost of living, the GST increase – while completely expected – comes at an unwelcome time.

There was some good news this week when FairPrice Group (FPG) announced that its chain of supermarkets will absorb the one percentage point increase in GST for 500 essential items – including rice, vegetables, fresh fruit, paper products and detergent – throughout the first six months of 2024. FPG said that the items covered under the scheme are those that customers buy frequently. It is not the first time FPG has dished out discounts during GST adjustments, having previously done so on three previous occasions.

Of course, not everyone can or will be as generous or altruistic as FPG, but its example is a good one to follow and one that should be praised. As it is, there are already concerns on the ground that some companies could capitalise on the situation and use the GST hike as a convenient reason to raise prices by more than they should.