[OFFICIAL][LIVE 18 Feb 3:30PM] The 9% GST Budget

[bluerhino]

And that's provided that your company is also GST-registered, isn't it?

What if your company isn't (eg the average hawkers)? Does that not mean you can't claim back the GST you've paid your supplier? With GST increase, your cost will increase (need to pay extra $0.09 for every $1 you pay your supplier), who do you think you will eventually pass the extra cost to?

Yes technically it's not compounding, but the price increase is not necessarily due to businessman's profiteering.

If you sell kopi for $1 and now you increase price to $1.20. Say your expenses average to $0.80 per cup. Increase gst by 2% at most increase your expenses by $0.016 per cup but you go increase your price by $0.20 this is not profiteering is what?

 

[bluerhino]

But If got SMEs that is not GST-registered, how ah? How about those PHV folks???

I dunno if Hawkers are GST registered leh......Then how about hawkers ah?

I lazy to spoon feed you. Besides asking questions you got any contribution? You go work boss ask you to do something you also keep asking how ah how?

 

[dezzo69]

GST is essentially compounded tax across the entire supply chain. This is it...

precisely. becoz a ''levy'' for the middleman is slapped just below the gst everytime goods change hand in the supply chain.

from the time a product enters the border to the time it actually ends up in the shop, a product could have changed hands 3 times.

 

[Cometdevil]

Alot of the questions this morning were parts and pieces explained / refuted in the earlier posts..
Please read Infront as due diligence

 

[michael2000]

Business will use GST increase as excuse to wack ppl hard... N they can do it 2 times .. over 2 years..

Talk about prices. Foods at hawker centres have seen an increase in prices.
Eg. bowl of noddle recently increases from #3.00 to $3.50.
Come 2023, GST increase to 8%, increase to $4.00,
Hawker reason - the govt increase price in everything, leh
Come 2024, GST increase to 9%, increase to $4.50 -
Hawker reason - same, same

See what happen to the poor working class

 

[harbinger255]

I don't understand what is with all the math calculation. The reason why it will not be 2% hike is because Singapore import all the different things from all over the world. Taking into account the hike of price without the GST due to inflation, it is already more than 2%. Adding to the GST it will definitely be more than 2%. The logic is 2% gst hike is only 2% is when you are producing your own good and services and part and producing the final good to consumer. That is when you get 2% gst hike which is truly 2%.

Our govt is too textbook thinking. Gst hike will never be 2% unless u know how to produce your own good for your own economy.

What you talking about? Manufacturers no need to pay GST for raw mats, services, rent etc etc meh? (Again, input tax)

Did you mix up SG GST with MY SST with is 10% at manufacturer level and 6% at retail??

 

[NTB2DO]

If you sell kopi for $1 and now you increase price to $1.20. Say your expenses average to $0.80 per cup. Increase gst by 2% at most increase your expenses by $0.016 per cup but you go increase your price by $0.20 this is not profiteering is what?

I'm not talking about this. But anyway, someone else had explained to me why, ON PAPER, end consumers should always be paying only the additional 2%.

 

[bluerhino]

I'm not talking about this. But anyway, someone else had explained to me why, ON PAPER, end consumers should always be paying only the additional 2%.

We all know that is not realistic. That's why I say want to blame price increase don't blame GST, blame the business owner profiteering. If no GST increase they will also anyhow find excuse to raise price. I remember that time vegetable price increase because of flood in Malaysia. When the flood issue was over the price never went back down to before. Best is my downstairs zichar store also increase price by $2 for a plate of vegetables for the same reason. The cost price of the vegetables maybe increase 50 cents only but they go increase by $2. This one until now never reduce back.

 

[NTB2DO]

We all know that is not realistic. That's why I say want to blame price increase don't blame GST, blame the business owner profiteering. If no GST increase they will also anyhow find excuse to raise price. I remember that time vegetable price increase because of flood in Malaysia. When the flood issue was over the price never went back down to before. Best is my downstairs zichar store also increase price by $2 for a plate of vegetables for the same reason. The cost price of the vegetables maybe increase 50 cents only but they go increase by $2. This one until now never reduce back.

No, it's not necessarily purely due to business owner profiteering (even though it's likely the biggest cause of the unproportionate increase in price). On paper, business owners can always claim back the additional cost incurred as a result of the 2% increase, but it's not always feasible or practical for them to make claims (the 2%) for every single expense, esp if the amount that they can claim back is not significant enough. Yet small expenses still add up, leading to higher operating cost. And business owner will eventually pass such cost to end consumers.

 

[bluerhino]

No, it's not necessarily purely due to business owner profiteering (even though it's likely the biggest cause of the unproportionate increase in price). On paper, business owners can always claim back the additional cost incurred as a result of the 2% increase, but it's not always feasible or practical for them to make claims (the 2%) for every single expense, esp if the amount that they can claim back is not significant enough. Yet small expenses still add up, leading to higher operating cost. And business owner will eventually pass such cost to end consumers.

I feel differently, businesses higher up in the value chain will usually have bigger scale hence they will definitely claim back the input tax. Only when you reach the shop owner then yes maybe they have too many sources of expenses and not practical to claim input tax on all items. Still the impact purely from GST should still be in the single digit %. However imagine at each stage of the chain the businesses add 10% to the cost then this compounds to a much higher % increase to the price consumers pay. I still see this as towkays wanting to earn more. My supplier increase their price by 10% I increase mine by 15% and so on. So I do believe the hawker telling me they need to increase price by 30% to survive but of that 30% most of it went to the different towkays. GST increase is just a convenient excuse for all businesses to explain their price increase to their customers. If not for GST increase they can also cite increase in oil prices, cost of shipping from China etc.

 

[Meteor84]

I feel differently, businesses higher up in the value chain will usually have bigger scale hence they will definitely claim back the input tax. Only when you reach the shop owner then yes maybe they have too many sources of expenses and not practical to claim input tax on all items. Still the impact purely from GST should still be in the single digit %. However imagine at each stage of the chain the businesses add 10% to the cost then this compounds to a much higher % increase to the price consumers pay. I still see this as towkays wanting to earn more. My supplier increase their price by 10% I increase mine by 15% and so on. So I do believe the hawker telling me they need to increase price by 30% to survive but of that 30% most of it went to the different towkays. GST increase is just a convenient excuse for all businesses to explain their price increase to their customers. If not for GST increase they can also cite increase in oil prices, cost of shipping from China etc.

gahment supporters can do the maths all they want and they are right. on paper, a 2% increase does not affect us at all. and you are right, businesses can cite everything to increase price including using GST as a perfect excuse.

what i am pissed about is the gahment showing stats, giving chicken skin (not even a chicken wing this time) and completely ignoring the fact that reality is totally different from doing maths or taking a finance exam. pls dont show me maths. take a walk down any hawker centre. gahment supporters here quote inflation. i am sorry, my kopi was still $1.30, my prata was $1.20 when news of hyper inflation already hit the market a long time ago. but magically everything increase by 20c after gahment announce GST.

 

[NTB2DO]

I feel differently, businesses higher up in the value chain will usually have bigger scale hence they will definitely claim back the input tax. Only when you reach the shop owner then yes maybe they have too many sources of expenses and not practical to claim input tax on all items. Still the impact purely from GST should still be in the single digit %. However imagine at each stage of the chain the businesses add 10% to the cost then this compounds to a much higher % increase to the price consumers pay. I still see this as towkays wanting to earn more. My supplier increase their price by 10% I increase mine by 15% and so on. So I do believe the hawker telling me they need to increase price by 30% to survive but of that 30% most of it went to the different towkays. GST increase is just a convenient excuse for all businesses to explain their price increase to their customers. If not for GST increase they can also cite increase in oil prices, cost of shipping from China etc.

I never deny that towkays' profiteering is likely to be the biggest cause of unproportionate increase. I'm saying that it's not purely so.

OK let me quote another scenario. Company pays a lump sum to its salesperson as transport allowance. Cost of petrol goes up by 2%, salesperson's transport cost goes up. Company will then have to increase the transport allowance. My question is, can the company claim from govt the additional allowance it has to pay its salesperson as a result of the GST increase? If it can't, who, do you think, the company will eventually pass the additional cost to?

 

[harbinger255]

gahment supporters can do the maths all they want and they are right. on paper, a 2% increase does not affect us at all. and you are right, businesses can cite everything to increase price including using GST as a perfect excuse.

what i am pissed about is the gahment showing stats, giving chicken skin (not even a chicken wing this time) and completely ignoring the fact that reality is totally different from doing maths or taking a finance exam. pls dont show me maths. take a walk down any hawker centre. gahment supporters here quote inflation. i am sorry, my kopi was still $1.30, my prata was $1.20 when news of hyper inflation already hit the market a long time ago. but magically everything increase by 20c after gahment announce GST.

Why not blame the weather? The war in ukraine?

Have you seen the recent commodities charts?

 

[tomasulu]

I think if there's input and output gst, it's more than 2%.

Gst is a regressive tax that hits the poor more but Singapore has a very high proportion of high income earners. Who gst is meant to hit are those maids and construction workers mostly unless they don't have to pay gst...

Gst is a good tax because if you plan spending wisely, you will end up being rewarded with less tax and less consumption which mean less pollution to mother earth

Stopped at good tax.

 

[charleslee1989]

I never deny that towkays' profiteering is likely to be the biggest cause of unproportionate increase. I'm saying that it's not purely so.

OK let me quote another scenario. Company pays a lump sum to its salesperson as transport allowance. Cost of petrol goes up by 2%, salesperson's transport cost goes up. Company will then have to increase the transport allowance. My question is, can the company claim from govt the additional allowance it has to pay its salesperson as a result of the GST increase? If it can't, who, do you think, the company will eventually pass the additional cost to?

I remember you cannot claim input tax on operating expenses on motor cars, right??


@bluerhino , am I right?

 

[NTB2DO]

I remember you cannot claim input tax on operating expenses on motor cars, right??


@bluerhino , am I right?

I think as long as you have black and white and you can justify it, you should be able to. Practical or not is another matter.

 

[harbinger255]

I think as long as you have black and white and you can justify it, you should be able to. Practical or not is another matter.

https://www.iras.gov.sg/taxes/goods...(input-tax)/conditions-for-claiming-input-tax

Regulations 26 and 27 of the GST (General) Regulations do not allow you to claim input tax incurred on the following expenses:

• Benefits provided to the family members or relatives of your staff;
• Costs and running expenses incurred on motor cars that are either:
  • registered under the business' or individual's name, or
  • hired for business or private use.
• Club subscription fees (including transfer fees) charged by sports and recreation clubs;
• Medical expenses incurred for your staff unless
  1. the expenses are obligatory under the Work Injury Compensation Act or under any collective agreement within the meaning of the Industrial Relations Act; or
  2. the medical treatment in respect of expenses incurred on or after 1 Oct 2021 is provided in connection with any health risk or requirement arising on account of the nature of the work required of your staff or his work environment; and
     1. the medical expenses are incurred pursuant to any written law of Singapore concerning the medical treatment or the provision of a medical facility or medical practitioner; or
     2. the medical treatment is related to COVID-19 and the staff undergoes such medical treatment pursuant to any written advisory (including industry circular) issued by, or posted on the website of, the Government or a public authority.
• Medical and accident insurance premiums incurred for your staff unless the insurance or payment of compensation is obligatory under the Work Injury Compensation Act or under any collective agreement within the meaning of the Industrial Relations Act; and
• Any transaction involving betting, sweepstakes, lotteries, fruit machines or games of chance.

 

[charleslee1989]

I think as long as you have black and white and you can justify it, you should be able to. Practical or not is another matter.

But I saw this leh....

 

[charleslee1989]

So people in sales profession are not singaporeans???

 

[NTB2DO]

But I saw this leh....

Which is why it's only on paper that consumers will only pay extra 2% and nothing more than that.