[About this blog] Inspired by local soccer player Mike Lim during my rookie reporter days at Singapore Polytechnic, I set up this blog in August 2002. I feel that blogging is a novel platform to document interesting facets of my life and my thoughts on certain issues. [Email blogger] ephraim@singnet.com.sg

Thursday, November 23, 2006

[GST Again]
1. Since PM announced GST going up to 7%, there has been an avalanche of negative comments. Some funny cartoons are also in circulation. However, I believe that once the details come out, Singaporeans will have a clearer picture of what the Government is trying to achieve.

2. This is not a zero-sum game robbing Peter to pay Paul however deserving Paul may be. It is a much larger exercise to put Singapore on a better financial footing to address some very big challenges ahead of us. To address these challenges, we have to make sure that the great majority of Singaporeans stay competitive in the global marketplace and the minority among us who face difficulty are given help.

3. The big challenge is the rise of China and India. Just engineers alone, these two countries will produce a million new graduates a year. A million!! In the last 10 years, China has poured billions of dollars into upgrading its universities. In all the major cities, the Chinese have built enormous parks housing many universities for all kinds of subjects. India is starting to do likewise. Whether we like it or not, this has a huge impact, not only on us, but on every other country. This is the reason why protectionist sentiments are on the rise.

4. Now China and India are moving closer together. President Hu Jintao in his recent visit to Delhi said that the world is big enough for both China and India to grow and develop. Indeed, their growth will open a new era of prosperity in Asia. Many people are already talking about this being the Asian century. But the question for us is where Singapore stands in this new Asia. No one owes us a living. We have to meet the competition head on. If we don't keep up with the competition, we'll be left behind. This is the reason why we have to continue investing in education, retraining, R&D and making sure our infrastructure is tip-top. Our greatest advantage is our pro-business environment - no corruption, fast response, efficient logistics, law and order. Only with investments coming in will our people have good jobs.

5. In the last few years, the workload in MFA and MTI have shot up because of the need to create new external space for our businesses to expand and create jobs. This evening, I'm following PM to Saudi Arabia and Qatar. The Middle East is an exciting new frontier for us. Many countries in the Middle East look up to us and want us to work with them. Now is the time to seize the opportunities.


Anonymous Anonymous said...

Did anyone NOT expect you sing with the choir? So all this post serves is to reassure us of your shallowness!

Saturday, November 25, 2006 6:44:00 am

Anonymous Anonymous said...

If people have to bear with the GST hike, the ministers should take a pay cut.

Remove GST from the essential goods. PAP arguments against doing it is noted and not accepted.

Saturday, November 25, 2006 8:52:00 am

Anonymous Anonymous said...

Please, people can take the truth (ie need to lower corporate tax to compete globally) better than some dubious need to "help the poor" "logic", when the poor will end up getting the highest increase in tax. But you guys will never listen, never have. Now the need to give civil servants higher pay, you can see where that is going.

Saturday, November 25, 2006 11:01:00 am

Anonymous Anonymous said...

you want to compete with china? china has a consumption tax which is variable and makes everyday goods (even shampoo) affordable for the common chinese, while taxing luxury goods which only the rich can afford more. china is so big, yet they can do this variable consumption tax. singapore is so small yet cannot do this. how to compete with them like this, if we are not nimble in areas where we should and can be?

so don't try to use china as an excuse...

btw, i read the china stuff from your esteemed state paper, so it must be true.

Saturday, November 25, 2006 11:07:00 am

Anonymous Anonymous said...

This is so typical isn't it. You guys just give the same reasons over and over again, even though most Singaporeans don't accept it at all. But then again, who is there to stop you guys from doing anything you want?

I presume the next thing that will increase would be minister's pay. Why not? You'll have the same reasons you did before, i.e. minister's pay haven't increase in x years, have to be line with the corporate world, etc. It is funny, your pay follows the highest corporate earners and the other civil servant's pay follow the lowest corporate earners. So wonderful isn't it. And to justify that we need high pay to attract good people is BS. You guys admitted yourself that you find it difficult to find good people.

One last thing, during the economic crisis, governments in the world were helping their citizens by lower cost of items and etc. What did we do? We helped too by INCREASING bus fares, INCREASING gst, LOWERING pay. Wow! It was wonderful to know you care. And the high income earners definitely didn't feel the pinch as much as the low income earners.

This is enough for now.

Desmond Lim

Saturday, November 25, 2006 11:58:00 am

Anonymous quzy said...

You're 100% right, this is not a zero-sum game robbing Peter to pay Paul. AND THIS IS WHAT WE'RE UNHAPPY ABOUT!!!!

You're going to rob PETER to pay PETER, ie, take GST from the poor and return to them in the form of meagre social aid.

And it's not zero-sum. It's all gain for Gvt's coffers, the rich, and foreign (talent or not), while all loss for the poor.

Saturday, November 25, 2006 12:38:00 pm

Anonymous Anonymous said...

oh dear, oh dear george. how silly can u be? the common folks are an educated lot now.'to help the poor'. come on george. when u cant even convince urself, how then to convince us.

that wasnt a convincing post. who are u kidding? sigh, for a generously paid minister, all u serve on ur plate are rhetorics and propaganda, pretty bad ones honestly. grow up george.

Saturday, November 25, 2006 1:10:00 pm

Anonymous Anonymous said...

There's a reason why you had the smallest winning margin in the recent elections among your peers in parliament, and that's even inclusive of the opposition. Shame on you.

Saturday, November 25, 2006 3:37:00 pm

Anonymous Anonymous said...

How do you sleep at night, knowing fully well that you are receiving an indecent salary, considering there are many more capable and qualified, and you were chosen because of your willingness to sing with them not us!

Here you are just proving us right...

Saturday, November 25, 2006 6:17:00 pm

Anonymous Anonymous said...

now u r in the middle east. gonna get chummy with the arabs just so u can fatten ur xxl-size wallet. cover urself with black gold eh. why dont u share with the arabs your wonderful plan to tax the poor to help the 'poor'(read: the very rich). even they wont buy it.

Saturday, November 25, 2006 7:50:00 pm

Anonymous Anonymous said...

Thanks for the daily "talk" again. If globalisation is the reason for the GST hike, then please explain clearly. First, it was to help the poor and that did not down well. So, now is globalisation, China, India and engineers. OK, next one please, we are waiting for the "talk" again. You know the real reasons why the GST hike, you just do not want to say it. You are a well educated person and yet you do not behave like one who stand on YOUR OWN FEET.

And yes, how do you sleep at night and face your children in the morning? Also, your parents who raise you and hope that you become a good person...

Saturday, November 25, 2006 9:59:00 pm

Anonymous Anonymous said...

i've a feeling he's gonna censor and moderate his own blog once he read our comments. now how cool is that..

Saturday, November 25, 2006 10:51:00 pm

Anonymous Anonymous said...

I can understand the rationale of reducing income tax and corporate tax and increasing GST to cover the possible deficit. The cabinet just need to catch the bull by the horns and explain the rationale clearly to your citizens. Please do understand that we all get confused if the communications is not clear.

On a separate issue (not to mess up the 2 issues) I too am happy to note that the government intends to help out the poor in our society. Thank you. By the way, welfare is not a vulgar word. I totally disagree with our
PM. Welfare, workfare, helping the aged who cannot work (welfare) helping the single mom who needs to stay home to raise the kids and can't work (welfare) I think that is a noble route to take and not vulgar at all. God bless Singapore and her leaders to taking this track!

Saturday, November 25, 2006 11:54:00 pm

Anonymous Anonymous said...

Thanks for the post. Just a primer, many of us on this blog are (very) highly-educated Singaporeans, so we know about the need to be competitive, about globalization, about the perils of a welfare state.

But we are not talking about handing out aid indiscriminately. As with most things in life and public service, the key is ‘balance’. The overwhelming consensus is that the government has swung way, way off to the end favoring the rich. Take a step back with new eyes. Maybe the sense of injustice will become more palpable then.

I agree it is very hard to govern well. And that’s why I believe Ministers should be paid their worth, but we need leaders who are not just rational, efficient and smart. We need people who feel and empathize with Singaporeans. Would a little step towards the masses portray our leaders to be soft, indecisive or less pragmatic? Would this step lead irretrievably down the dangerous slide towards welfarism? I do not think so. That’s why we need solid leaders like you up there.

It boggles me that you guys have not considered exempting GST for necessities (bread, sugar, flour, rice, oil, eggs etc). It is well-established in many countries with VAT or GST. There are no negative ramifications to this, unlike the minimum wage system which I agree has done much harm to the poor based on empirical evidence elsewhere. So what’s the deal? I don’t believe the GST on necessities are so huge as to affect the government’s tax revenues. If it is, then I really worry because it would only mean the poor have been inordinately disadvantaged all along.

GST’s essence has been (hopefully), and should be, in taxing discretionary spending, and not on items of subsistence. In many US states, basic food items are taxed at 2%, rather than the full VAT of 7%. Whatever leadership skills you learnt at HBS, it is time to bring them out now.

Sunday, November 26, 2006 8:07:00 am

Anonymous Anonymous said...

Through this blog of yours, what you write tell and confirm to us that you are one of those who have no balls to stand up for the people. You are simply an opportunistic band-wagon reaper of glory, name, fame and riches.

Sunday, November 26, 2006 11:37:00 pm

Anonymous Anonymous said...

george yeo, its time to wake up your conscience. Resign and fight for the common men. If you do so, you will live happily in your old age. I believe you have enough savings to last a lifetime. So please do something good for the people.

Monday, November 27, 2006 4:05:00 pm

Anonymous Anonymous said...

he doesn't care. just emigrate if and when you have the chance. do you think he actually reads this blog? probably gets someone in mica to write responses on his behalf.

Monday, November 27, 2006 9:18:00 pm

Anonymous Anonymous said...

It is strange that most of people are criticising the minister and government for raising the GST. Besides criticising, why don't you give suggestion? Government has told you all the problems and they have come up with a solution. If you are not happy with the solution, pls give your suggestion. Pls don't tell me why we are paying the Minister so much and he cannot come up with a solution or siding to the Government on the problem. Nowsdays, most singaporeans know how to criticise and do not come up with solution. Does criticising solve the problem? The answer is "NO". Pls, be a responsible singaporean, give your view and your idea. Don't be a "NATO".

Tuesday, November 28, 2006 5:18:00 pm

Anonymous Anonymous said...

to mr anonymous(5.18pm),

george, is that you?

Wednesday, November 29, 2006 2:11:00 am

Anonymous Anonymous said...

Provide solutions to "highly educated sholars"? If citizens can solve their problems on their own, would you still need them?

Does a CEO ask his admin clerks on how to balance the accounts of his multi-million dollar business?

Wednesday, November 29, 2006 12:14:00 pm

Anonymous Anonymous said...

If you use your CEO as example, then I would like to ask you whether do you question your CEO in decision making. If you do not question your CEO, then the comparision is not suitable in this case. As i mentioned in my previous comment, pls give constructive suggestion and let the government has a chance to hear your suggestion. Many people have been saying that Government is not listening because whatever comments or views that had been expressed, none of it has been taken. But there are certain things that they have implemented and taken into considersation, no one knows about it. Actually all of us have a chance being the 3rd party to view all these issues. We wants Government to listen to us, but we have to listen to them 1st. To hear what they want to say before we comment. I do agree with most of them that the most affected lots in the GST hike are the middle income families and GST should not be included in the medical, but I am waiting for them to announce how are they going to 'compensate' or help the lower income families and medical issue.

Wednesday, November 29, 2006 3:13:00 pm

Anonymous Anonymous said...

whoever blogs in numbered paragraphs?

Thursday, November 30, 2006 12:24:00 pm

Anonymous Anonymous said...

I understand and fully think that the GST hike was imperative for Singapore's economic sustainability in the long term.We're on the same economic playing field as many rapidly developing hungry economies ie the Scandivinian countries and we've to continually find ways and means to be ahead of the intense competition.Many countries,like Latvia,for instance,has a corporate tax of 15% which is much less that of Singapore's 20%.Surely,with its vast lands and ample natural resources,it would be better off in attracting foreign investments(MNCs),outweighing Singapore.So Singapore has to find ways to maximising our human capital and giving huge incentives and perks to these foerign investors.I believe the Govt would be reducing the corporate tax by 19% in the next fiscal year and a 1% point drop would incur a loss of 700 million dollars(stated by PM).to offset the loss,we need to raise the GST.I fully support the Govt's position to increase indirect taxes like the GST because I know that it would be of benefit to sinagapore in the globalisation marathon.

Tuesday, December 12, 2006 8:17:00 pm


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