SINGAPORE: Speaking at a People’s Action Party (PAP) rally for Nee Soon GRC at Yishun Stadium on 29 April, K Shanmugam defended the government’s decision to increase the Goods and Services Tax (GST).
He claimed that the majority of Singaporean households would receive more from government assistance than they would pay in GST over the next five years.
“The opposition is not telling you the truth,” Shanmugam said, criticising opposition parties for their calls to abolish taxes and offer state benefits for free.
“I have seen some of the things that the opposition has been saying: ‘this one can be free, that one can be free, no need for GST, no need for any tax.’”
He went on to warn voters against trusting politicians who make promises of free services without explaining how they will be funded.
“You know, some people say, ‘you have reserves.’ When politicians tell you, ‘vote for me, you don’t have to pay for anything and everything can be free,’ I think you better ask some questions,” he said.
“That might work for a few years. After that, you’ll see what is happening in all the other countries where politicians tell you these things.”
Framing the debate as a matter of values, Shanmugam stressed the importance of fiscal responsibility.
“It’s a question of values—our Singaporean values, our Asian values. We spend what we earn. We don’t say, ‘you can spend without putting money aside.’”
He added that overspending without planning would jeopardise the future of the country and its people. “In a few years, your future, your children’s future, and the country’s future will go down.”
Reiterating the PAP’s position, he said, “We are successful because we always tell the truth directly. We face reality.”
Shanmugam also addressed claims that inflation was driven by the GST hike, which was raised from 7 per cent to 9 per cent over two years, in 2023 and 2024.
“They make you frightened. They say inflation is because of GST. What is the truth? The majority of Singaporean households will get more money from the government than they will pay in GST for five years,” he said.
Mixed Reactions on Social Media
Shanmugam’s comments, which were shared on The Straits Times’ Facebook and TikTok pages, sparked significant debate among netizens, particularly regarding his claim that the opposition had argued there was “no need for GST.”
One user clarified that the opposition had not called for the complete abolition of GST but had instead advocated for a delay in the GST hike due to financial strain caused by COVID-19, with the aim of easing citizens’ burdens.
Another netizen accused PAP MPs of misrepresenting opposition positions.
They wrote, “PAP MPs have a tendency to pick and choose from the opposition’s speech and twist the narrative to suit their agenda. Such an uncle tactic, but sorry, our education system has moulded more intelligent people.”
Concerns Over the GST Hike and Cost of Living
The 9% GST increase has stirred frustration, with many netizens expressing concerns about its impact on the cost of living.
One user likened the increase to a knife at the neck of citizens, asking, “How long do we have to go on with this?”
Others criticised the government’s financial aid packages in light of the GST increase.
One comment noted, “If you didn’t increase GST – like was promised – we wouldn’t need the vouchers.”
Another suggested, “How about you take back all the money and revert to 7% GST?”
One user also questioned Shanmugam’s claim that most Singaporeans would receive more in government assistance than they would pay in GST over the next five years, asking, “If that’s the case, then why implement GST at all?”
The Disconnection Between Government Policies and Citizens’ Realities
Some netizens felt the government was out of touch with everyday concerns. They noted that while the GST increase was only 2%, everyday goods had seen much steeper price hikes.
One user remarked, “It might be true if you just compare handouts to the GST increase. But when inflation is turbocharged, the increase in prices could be ten times more than the handouts.”
Another echoed the sentiment, stating, “Our day-to-day things have all increased, so at the end of the day, the small little increases became a mountain! From a small ripple, it became a tsunami. Don’t you see that?”
Others expressed frustration over the struggles of middle-income Singaporeans, who felt caught between the government’s support for lower-income groups and a lack of relief for the middle class.
One user commented, “We pay more GST than lower-income earners but don’t get the benefits like Workfare, and our cash payouts are just a few hundred dollars.”
Long-Term Concerns for Future Generations
Some users raised concerns about the long-term effects of the GST hike, particularly for future generations.
One user warned, “It’s not just about the money we have now, but the future of our children and younger generation. They will bear the consequences of higher GST.
The government can’t just sprinkle money as a solution—eventually, the tap will run dry.”
Opposition Parties Criticise the GST Hike
The GST increase has become a central issue in the general election, with opposition parties strongly criticising the rise.
The Progress Singapore Party (PSP) and Singapore Democratic Party (SDP) have called for the GST rate to be reduced to 7% or lower, arguing that this would alleviate the cost-of-living pressures faced by Singaporeans.
Meanwhile, the Workers’ Party (WP) has questioned the timing of the GST hike, suggesting that it could have been postponed.
In its manifesto, PSP has proposed reducing the GST from 9% to 7%, reversing the two-stage hike introduced in 2023 and 2024.
PSP argues that GST disproportionately affects lower-income households and advocates for exemptions on essential items such as rice, cooking oil, and infant formula.
Similarly, the SDP has called for the reduction of the GST to 7%, with the additional proposal to abolish the tax entirely on essential goods like food and medicine.
On 28 April 2025, Workers’ Party (WP) chief Pritam Singh delivered a strong critique of the PAP government’s decision to raise the GST amid global inflation.
Singh argued that the hikes had “turbocharged” inflation, exacerbating the already dire cost-of-living crisis. He criticised the timing of the increase, calling it avoidable.
Singh pointed out that the Workers’ Party had opposed the GST hike during parliamentary debates, emphasising that few governments worldwide chose to raise consumption taxes while inflation was soaring.
He remarked, “Which government turbocharged inflation with a consumption tax hike? Nobody did except the PAP.”
While acknowledging the PAP’s rationale that the hike was necessary to meet future healthcare and ageing population costs, Singh maintained that the GST increase could have been postponed.
The post Netizens push back against Shanmugam’s GST defense, cite cost-of-living woes appeared first on The Online Citizen.
