The silent tax increase

orwell76 SG

The greatest political feat the ruling elite has pulled off this year is silent tax increase for the accounting year 2006.

With personnal income relief reduce to $1000 for the accounting year 2005, most taxpayers have ended up paying more tax.

CPF capped has been reduced to $4500 for the year 2006. Any earned income above $4500 does not attract CPF. The main stream media lauded the move as a positive one, allowing wage earners to have more take home pay.

What this translate to will be high income taxes for year 2006.

foomwee88 SG

That why we hve 2 migrate!!This shti sg gov No transparenty n accountability same as Ah Bian in TW!!!!

orwell76 SG

I am sure someone will reply in the forum that Singapore's tax rate is one of the lowest in the world...

Not to forget, there might also be a hike in GST soon...

I-like-flings(m) SG

Laughing

I'm paying almost 20% tax this yr here.... but.. i am still happy with it...at least they are transparent about it ... not like someone.... Cool

dragg SG

i am not paying any tax because i earned nothing for the third straight year.

should i be happy?

Confused

beavan SG

student?

dragg SG

unemployed.

blowfish SG

so long?

Hogzilla SG

Ok, what’s new when you have Pay-And-Pay?

ShutterBug SG

There's little, or NO welfare for citizens, and yet our gov silently increases tax every year.

Hey foreigners, read this & know what you're giving up your own country for!!

anonymouscoward SG

I thought personal relief was reduced to $1000 quite a 2-3 years back? You also forgot to mentioned that they combined CPF and insurance into a single component; if you contribute more than $5k CPF a year, you are no longer eligible for insurance premium deductions to offset your tax. This also happened a 2-3 years back.

In addition, they also change the income calculation brackets etc.

Capping CPF at $4500 meant more than just more tax;
1) reduce pay as employers pay less CPF to you
2) less money to go towards mortgages, more cash payment

However, it does means that you have more flexibility to use the additional cash that would have been locked away in CPF.

On the surface, it looks good to be getting more cash but one has to bear in mind that they need to be discipline to set this (and other) amount aside for retirement.

Lowclassman SG

That's why....

I urged everybody to spend as little as possible...Don't buy a car unless you have no choice. Or else, you will ended up paying most of your hard earning $$$ to govt. If you are wise enough, cycling will be a best option. Mr. Green

mistyblue SG

people who need more liquidity are the low wage earners... That move didn't help anyone but the tax collectors. Tax is a tricky issue. It can be a fair way to "redistribute" wealth and contribute to society - that is if it is managed fairly. It is also a good way to discourage people from working hard to stay below the "tax rate" or use creative accounting (as what we see by the actions of our system) to avoid tax altogether.
simple maths would show our tax rate is not low but average, but most people take the face value give on the tax form or newspapers to be the rate.

ObiterDicta SG

Silent meh? The CPF cap reduction was announced at least 2 years ago, and the tax implications were discussed by financial planners in the papers as well.

Where have you been?

obiterdicta

ObiterDicta SG

Your approach is most sensible and proactive! Very Happy

orwell76 SG

It was discussed in the papers, in vague terms. I don't they ever table a set of values that say if your income is this figure, after adjustment for the new CPF cap, you have to pay this amount in extra tax.

Main stream media always like to publish table and charts on loans and mortages based on different rates in the Sunday papers to educate the public, wonder why there was a complete silence on this subject matter.