At a rally held on 28 April 2025 at Yusof Ishak Secondary School, Workers’ Party (WP) chief Pritam Singh delivered a strong critique of the People’s Action Party (PAP) government’s decision to raise the Goods and Services Tax (GST) during a period of global inflation.
Singh described the GST hikes as having “turbocharged” inflation, exacerbating the cost-of-living crisis already faced by Singaporeans. He emphasised that the decision was poorly timed and avoidable.
The GST increase, announced in Budget 2022, involved a two-stage hike from 7% to 9%, with the first increase to 8% on 1 January 2023 and the second to 9% on 1 January 2024.
According to Singh, the Workers’ Party had opposed the GST hike during parliamentary debates. He highlighted that, globally, few governments chose to raise consumption taxes while inflation was soaring.
Singh argued that the PAP’s decision was unique, stating, “Which government turbocharged inflation with a consumption tax hike? Nobody did except the PAP.”
He acknowledged the PAP’s rationale that future healthcare and ageing population costs necessitated revenue increases. However, he insisted that the GST hike could have been postponed.
Referencing debates in Parliament, Singh recalled questioning the Prime Minister about the impact of the GST hike on inflation. He pointed to a statement by the Monetary Authority of Singapore (MAS), under the Prime Minister’s Office, which indicated that the GST hike could raise inflation by up to 40%.
“Isn’t that turbocharging?” Singh asked, asserting that the government was aware of the inflationary effects but proceeded nonetheless.
Singh further criticised the government for acting despite a reported fiscal surplus of more than S$14 billion during the past parliamentary term. He contended that this surplus demonstrated that the GST hike was unnecessary at that time.
He noted that Singaporeans had experienced sharp cost increases across various sectors, including food at hawker centres and election campaign costs, which had risen by 25% since 2020.
Singh expressed concern for retirees reliant on CPF payouts, highlighting that such payments do not adjust for inflation, leaving seniors particularly vulnerable.
He also referenced a comment by a PAP MP, who suggested that a “little pain” was necessary to keep Singaporeans “alert.” Singh called this sentiment insensitive, questioning why additional pain had to be inflicted on citizens already struggling with global inflation.
Singh stressed that the PAP’s ability to implement unpopular policies without severe political consequences stemmed from a lack of sufficient pressure from opposition parties.
He urged voters to support the Workers’ Party, arguing that stronger opposition presence would force the PAP to reconsider or better time future policy decisions.
“Votes and seats are the KPIs for PAP politicians,” Singh said. “When the PAP loses votes and seats to the Workers Party, it has to take corrective action.”
The decision to raise the GST despite a robust corporate income tax (CIT) collection had already faced public scrutiny. In 2023, then-Deputy Prime Minister and Finance Minister Lawrence Wong had rejected calls to defer the hike, despite CIT revenue climbing by 26.8% to S$23.1 billion.
According to a Straits Times report from 2023, Wong had argued that deferring the GST increase would create greater fiscal risks, citing long-term spending needs.
Opposition parties, including the WP and the Progress Singapore Party (PSP), had proposed alternatives such as drawing more from reserve earnings to avoid burdening the populace further.
Despite these calls, PAP MPs supported the GST hike during the Budget 2022 debate, maintaining it was necessary to ensure fiscal sustainability.
Singh’s rally speech highlighted enduring tensions over fiscal policy, cost of living, and the responsiveness of Singapore’s government to economic challenges faced by ordinary citizens.
Polling day is scheduled for Saturday, with opposition parties hoping to galvanise voter sentiment amid these economic concerns.
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