Minimum wage threatens survival of small businesses

last SG · 2006-11-22T15:43:42+00:00

Originally posted by spinsugar: [b]As for GST, it's truly ludicrous to justify the increase as a way to help the poor. If the poor were truly meant to be t...

Atobe SG

Originally posted by oxford mushroom:

Absolute rubbish! 60% of Singaporeans do not pay income tax and far greater numbers of low income earners in Singapore do not pay income tax compared to many other countries. It does not make sense anyway taxing the low income earners...they earn to little to generate sufficient revenue.

Yes, 'Absolute rubbish' to your piece that 60% of Singaporeans do not pay income tax'.

Amazing that you will dare to repeat this unsubstantiated claim after avoiding a reply to your thread of the same title.

Is it not even more of the same "Absolute rubbish" coming from a PhD mind that since "it does not make sense anyway taxing the low income earners... they earn to {too} little to generate sufficient revenue" - you will agree to this Government subjecting the low income group to additional tax burden with an increase of 2% GST, but yet will not give them a 'MINIMUM WAGE' to live decently ?

If this is not turning logic on its head from one who has been perched high up on the ivory tower, and losing touch with reality ?

Taxing higher income earners is counterproductive when our main competitor Hong Kong has a lower tax rate. We will only drive investments and jobs in that direction, if we follow the policies of Opposition Party supporters.

The higher income earners will have more then enough to afford to pay the higher taxes in exchange for a secure place to live in.

The Swiss are subjected to Taxes at the Federal, Cantons, and Communal levels; while their Personal income tax do not exceed 30%, yet their tax monies are collected that benefit the Swiss citizens directly in terms of a high standards of social welfare and health schemes.

Compared to the Swiss - an exercise often called by the Singapore Government when it suits them - Singapore Government sucks up every cent from Singaporeans but give back nothing, as what is given is always collected back again.

With a sound and democratic system of governance, where the Swiss Citizens are POLITICALLY INVOLVED in their COLLECTIVE FUTURE, the Swiss Citizens are not complaining; while many rich Europeans are buying their way into Switzerland.

The middle income group is the group that tends to get squeezed. If they have marketable skills overseas, more will consider leaving if we tax them too much. That's why indirect taxes like GST is better than ditrect taxes.

I think we should levy more indirect taxes on alcohol, cigarettes and cars. Tobacco and alcohol have a deleterious effect on health and puts a greater burden on the health system. Tax them to high heavens will put them out of the reach of the poor who cannot afford ill health anyway.

Taxation alone is not the determining factor for the Middle Income Group to migrate out of Singapore.

Ask any ex-Singaporeans living overseas, and majority will place - high on a list of factors - the stifling political culture, the stifling economic strangulation and manipulation of Singaporeans, biased and erratic educational policies - as the reasons for migrating.

Tax will probably not even enter the list of factors.

Why are you targetting and penalising the lower income group with indirect taxes ?

The rich and higher income group can always get away with their addictive habits of smoking and drinking, while the poor will be driven to madness with their craving to smoke or drink to relieve the stress that they are already subjected to by their poverty.

There should be some leeway for the poor to be given some avenues to relieve the pressures that they are subjected to.

Do you think that you are helping the poor and the government by removing cigaretters and alcohol from them ?

You may actually add an additional long term problem of having more in-house patients living in the mental institution; or cause some murderous assault when the poor goes berserk and attack family members or some others, or even injure themselves.

Think before you spout 'Absolute rubbish'.

oxford mushroom SG

This thread is about minimum wage...for further discussion about GST, go to this thread:

http://www.sgforums.com/?action=thread_display&thread_id=220070&page=21

oxford mushroom SG

[quote]Originally posted by Atobe:
Do you think that you are helping the poor and the government by removing cigaretters and alcohol from them ?

You may actually add an additional long term problem of having more in-house patients living in the mental institution; or cause some murderous assault when the poor goes berserk and attack family members or some others, or even injure themselves.[/quote]

Hahaha...nearly die of laughter...no alcohol and cigarettes will turn you into a madman....maybe that works for you Laughing

what absolute and utter rubbish Mr. Green

maurizio13 SG

Originally posted by oxford mushroom:

Haha...dig your grave further and show off your ignorance. Either that or you have 'conveniently' forgot to inform readers that China has very generous tax incentives for foreign businesses:

"Tax holiday for all manufacturing Foreign Investment Enterprises "FIEs" - a [b]two-year exemption followed by 50% reduction in tax rate for three years, starting from the first profitable year after utilizing tax losses; 15% tax rate in Special Economic Zones; 24% tax rate in certain coastal cities; Foreign investor reinvesting its share of profits for at least five years gets a 40% refund of tax paid on sum reinvested or 100% if reinvestment in advanced technology industries or export oriented enterprises."

(http://www.pwchk.com/home/eng/tax_inf_cn_2006.html)

As for India, read this:

"According to a study released last week by PricewaterhouseCoopers and the World Bank, the real burden of corporate tax in India, after companies take advantage of the relief granted by law, is 14.3 percent of pretax profit. That is less than the 17.7 percent in China and 22.4 percent in Brazil.

Among the so-called BRIC economies - Brazil, Russia, India and China - only Russia has a lower effective corporate-profit tax rate of 12.7 percent."

(http://www.iht.com/articles/2006/11/13/bloomberg/sxmuk.php)

tsk tsk tsk....check your facts before you shoot yourself in the foot Mr. Green

[/b]

If you haven't notice you are the only ignorant fool here, the whole world is against you, you are the only fool on the hill. Do you think that Singapore hasn't got it's own set of incentives?

Abstract from Singapore Master Tax Guide 2005 (Ch 18 Incentives Under The Income Tax Act):

"This chapter deals with some of the incentives contained in the Income Tax Act (Cap 134) (the "Act") and its subsidiary legislation. The incentives given to the selected group of taxpayers are either exemption from income tax or taxation at a reduced concessionary tax rate of usually 10% or 5%."

If you don't know this yet (as is always the case), pioneer industries are given tax exemption of up to 15 years (just to name one). There are other incentives other than sections under Income Tax Act, there is the EEIA (Economic Expansion Incentives Act), which provides for very favourable treatment of tax for companies (either exemption or a reduced tax rate).

You just stuff your foot in your mouth.

countdracula SG

bush and his republican morons also refused to tax the rich more...warren buffet remarked he's probably paying less tax than his receptionist...

4getmenot SG

so you are agreeing indirectly that s'pore does not have a world class health care system right? Rolling Eyes

4getmenot SG

rubbish! did the government released statistic figures for the number of white collar jobs (esp in IT industry) that was taken up by cheaper FTs from India, Vienam, China etc? Its not just blue collar jobs thats being taken away mind you..

maurizio13 SG

If you read through your IHT link again, you will realised that the corporate tax rate of 14.3% implied in the article uses exemptions included in the Income Tax Act to reduce their tax. If you don't know already our Income Tax Act has certain exemptions and deductions too. It's possible to reduce the Singapore Corporate Tax Rate to 9.5% of your profits if you know how. Hell, you don't even have to pay any corporate tax for the first few years, if you know how to plan your tax affairs. If you don't please consult your friendly local Big 4 Accounting Firms.

The article also states,

"Shifting to a 15 percent flat rate and scrapping the exemptions that companies use to lower their effective tax load should not result in any loss of Indian government revenue.",

which means the effect of the proposed tax cut is ZERO. Which is equivalent to our government reducing our tax rates to 15% and removing all the exemptions and deductions.

Your Link:
http://www.iht.com/articles/2006/11/13/bloomberg/sxmuk.php

The corporate tax rate according to the Finance Act of the Income Tax Department of India is still above 30%.

http://incometaxindia.gov.in/FINANCE%20ACTS/The%20Finance%20Act2001.asp

YOU RELY TOO MUCH ON OTHER PEOPLES ANALYSIS AND FAIL TO USE THE FAT IN BETWEEN YOUR EARS. THAT'S WHY YOU MAKE A FOOL OF YOURSELF AND SEE HORDES OF PEOPLE ATTACKING YOU. JUST CUTTING AND PASTING OTHER'S ANALYSIS WON'T MAKE YOUR SMART. USE THE FAT IN BETWEEN YOUR EARS!!!

maurizio13 SG

oxford mushroom:
Could you please respond to my earlier post instead of avoiding it?

Originally posted by maurizio13:

[b]Please get this through that thick skull of yours!!! Businesses don't rely soley on corporate tax rates to make capital investment decisions!!!

Do you know what is the corporate tax rate in China?

33%!!!

http://www.pwchk.com/home/eng/tax_inf_cn_2006.html

Do you see investments stifling in China?

If businesses just rely on corporate tax rates to make capital investment decisons, you won't see China booming.

Your thought processes are linear and led by a leash.
[/b]

maurizio13 SG

Why is it that other countries (other than Hong Kong, which is considered a tax haven) despite having a higher corporate tax rate but still thrive?

Originally posted by maurizio13:
FYI, the corporate tax rate in India is 33.66%.

If time permits click on the table to see corporate tax rates in the region.
I only see Hong Kong with the lowest corporate tax rate
http://www.kpmg.com/Services/Tax/IntCorp/CTR/

[b]GET THIS THROUGH THAT THICK SKULL OF YOUR'S, MULTINATIONAL COMPANIES DON'T BASE INVESTMENT DECISIONS ON JUST CORPORATE TAX RATES. IT WON'T EVEN MATTER IF YOU LOWER YOUR CORPORATE TAX RATE TO 0%, IN WHICH CASE YOU WILL BE BRANDED A TAX HAVEN AND FIND HORDES OF SHELL COMPANIES RELOCATING HERE.
[/b]

Atobe SG

Originally posted by oxford mushroom:

quote from original post by Atobe:
Do you think that you are helping the poor and the government by removing cigaretters and alcohol from them ?

You may actually add an additional long term problem of having more in-house patients living in the mental institution; or cause some murderous assault when the poor goes berserk and attack family members or some others, or even injure themselves.
--------------------------------------------------------------------------------------------------------

Hahaha...nearly die of laughter...no alcohol and cigarettes will turn you into a madman....maybe that works for you Laughing

what absolute and utter rubbish Mr. Green

If you must quote me, at least be honest and accurate in your attempt to do so, why did you leave out the first two related paragraphs from this part of my response to your previous post ?

"The rich and higher income group can always get away with their addictive habits of smoking and drinking, while the poor will be driven to madness with their craving to smoke or drink to relieve the stress that they are already subjected to by their poverty.

There should be some leeway for the poor to be given some avenues to relieve the pressures that they are subjected to."

Surely your time at Oxford would have taught you this courtesy, unless you have been too much of a lecherous mushroom not to have learnt such simple courtesy ?

You have shown yourself to be such a conceited and condescending expert with the richness of utter and absolute rubbish, can one expect you to have any empathy towards those who are less fortunate ?

Still no reasonable reply to your "Absolute rubbish" of 60% of Singaporeans not paying income taxes ?

Is your pickiness with my response to your last post not revealing some inadequacy of your thought process despite your PhD claims ?

the Bear SG

to that 60%, i'm still wondering how many of the 60% actually have an income?

or are babies, retired people, handicapped, children in schools also counted in the 60%? Laughing

Squiggly SG

Agree... to a certain extent, every economically active individual is some how a "premium" workforce...

Just that I'd hardly think the foreign countries want to import Singaporean "unskilled" manpower... Compared to the more economical options from Indonesia, Thailand, Vietnam, Cambodia, India, China etc.... Singaporean unskilled labour is still way too expensive...

The only Singaporean exports are usually knowledge-based Premium workforce... and these people venture overseas to seek a better than average lifestyle than they currently are enjoying in Singapore....

And the unskilled (and sometimes uneducated) in Singapore are left with no options... but to stay in Singapore, and live with whatever our policy makers drop on them...

oldbreadstinks SG

read something like that ages ago(when i was still in school, 10 years maybe?), but it was something like 70% and there was suppose to be an age blacket so children and really old people weren't included. nothing about handicapped though.

countdracula SG

no minimum wage? civil servants' pay to be raised so that it can match private sector, and naturally so to will the pay of political office holders (a good disguise).....the reason given is to retain talents.....it's not wholly valid as there will simply not be enough places in the private sector. in any case, they could well ship out some of the scholars given the recent less than stellar showing....

these guys have lost the moral authority to look into the eyes of the people and tell them they understand what the rising costs of living is doing to people and that they are doing all they can to help....no wonder they've been saying the widening income gap will widen even further...it's all a ploy????

foxwalk SG

I think ministers' pay is tax free...

So who wants to be minister?

the Bear SG

actually, let's adjust the pay to like "private sector" and to be equal to the "free market"

the working hacks in the civil service will have a pay increase and the MINISTERS will have a drastic pay cut when you benchmark (stupid word from the con-men-sultants) their pay against the other ministers in the world Twisted Evil

oxford mushroom SG

Exactly...unless unskilled and low-skilled Singaporeans upgrade themselves, they will lose out in the global market. Burying one's head in the sand or blaming the government will not help them.

There are skill development courses available partly funded by the government and in part by employers who stand to gain a trainee employee who will be bonded to them. It is turning into an employee's market now...low-skilled workers should take this opportunity to upgrade their skills while they can.

fymk SG

Oxford mushroom - aren't you a medical doctor or something? I would suggest that you read The Social determinants of health: the solid facts by Richard Wilkinson and Michael Marmot. Those lower income groups don't smoke or drink for the sake of burning money.

Frankly I belong to the middle income group and I left for a country which has a 10% GST tax and 27% off the income tax and every percent against each tax bracket above the nominal amount you get into . So what are you talking about discouraging migration through the introduction of indirect tax? Makes no sense to me whatsoever.

Upskilling the unskilled in what? To learn to be domestic help? Sell out the older and more experienced workers to a retirement life of being a Macdonald's uncle/auntie or a cleaner? You call that UPSKILLING? Oh yes that is what I heard from the grapevine in Singapore. Note it is much cheaper to hire domestic help from Indonesia, Thailand or Philipines.

Why even bother giving a lot of scholarships and bursaries to foreigners if locals are left out in the cold ? Other countries such as Australia can afford to give it out while keeping education very cheap - their university education is cheaper than Singapore's for their own citizens who can make it through the commonwealth supported place system.

I am no expert in minimum wage issues but the way I see it :

Minimum wages make a great idea and so is getting them indexed to the inflation rate - it does not open people to open and direct exploitation any more than they should be. What's wrong with that? Unless there is a ALREADY a plan to exploit them. Minimum wages are a reasonable request for the common workers out there. The sole opposing reason is usually that of making the rich RICHER and the poor suffer.

There are many ways of making small businesses survive . Minimum wage would not cripple it but increased GST might....since less people might spend freely. Large corporations, of course won't be crippled by that. And look at the market , the large corporations can afford to drop the prices of products pretty fast through centralised bulk buying (which attracts a large discount) and selling at a profit while the small business can't since they do not bulk buy and they have to deal with the overhead costs of an increased Gst plus less customers since most would flock to buy from a large departmental store for a lesser price.

oxford mushroom SG

Direct taxes as a strategy for raising revenue hits the high income groups most. But such a Marxist tax system is self-defeating. The group that contributes most to the nation's revenue also provides the most jobs. They are also the most mobile. By targeting them, they will move elsewhere, just like the Finnish financial expert who re-located to Singapore to escape the high taxes of the welfare state.

Minimum wages will be the fastest way to kill off SMEs. Big corporations can withstand an increase in manpower costs better than small businesses. In any case, it is unlikely that imposition of the minimum wage will affect businesses with full-time workers in a fairly high-value industry.

How high should the minimum wage be? Let's put it at $750 a month or its equivalent in hourly rates. Most Singaporean workers are already paid more than that. Even a Singaporean cleaner with Ministry of the Environment trained to use modern cleaning equipment stands to earn about $1k a month. The workers who will be affected will be your domestic maids, the unskilled Bangladeshi cleaner in your office and the like.

A minimal wage will benefit foreign domestic workers the most. Try to impose a minimum wage: it will be Singaporeans who will be up in arms, having to more than double the wages to their maids.

« Previous Page Next Page »