I REFER to Tuesday's reports ('PAP MPs question who WP is trying
to help'; and 'Rebates, subsidies ease hardship only in short-term,
says Low').
Worker's Party (WP) chief and MP for Hougang Low Thia Khiang and
People's Action Party (PAP) MP for Holland-Bukit Timah GRC
Christopher de Souza were both right in disagreeing about lowering
the goods and services tax (GST).
While Mr de Souza is right that higher consumption by
high-income earners leads to greater tax collection which is
redistributed more among the lower-income group, Mr Low is also
correct in saying that lowering the GST will directly help the
lower-income group.
The immediate benefit will be felt more than the indirect
benefits in the form of tax rebates, which is exactly what this
group of citizens need.
The Government should review lowering the GST on daily
essentials like food items which will help the needy, while the GST
on non-essentials or luxury items should be maintained as they
affect mainly the high-income group.
Ong Chee Keong
