Singapore Prime Minister and Finance Minister Lawrence Wong has reiterated his assurance to the country on cost-of-living support, stating “we will always stand with you”.
In a video posted on his X account on Monday, PM Wong again went over the rationale behind the hikes — in 2023 and 2024 — in the Goods and Service Tax in Singapore, a step that was criticised by Pritam Singh, Leader of the Opposition in Singapore Parliament. Singh said that the GST hikes had “fanned the flames” of inflation.
Explaining in the video the reason for the GST hikes, PM Wong reiterated what he had said during his speech during the Singapore Budget 2025 discussion in parliament — global events were driving up costs in the small and open economy of Singapore even before the GST rate hike, so the tax alone did not cause a spike in the cost of living.
“Around the world, inflation had surged because of wars and supply chain disruptions,” he pointed out. “No country has been spared. We feel the pressure here in Singapore, too…”, as the country had to import almost everything it consumed, said the prime minister.
About the fiscal situation of Singapore and its correlation to the GST hike, PM Wong reminded people that at the beginning of this decade, Singapore was in the “thick of battle”: the COVID-19 pandemic.
[COVID-19] was a time of great uncertainty [and] we didn’t know how long the pandemic would last… Our finances were stretched. We had gone to the [Singapore] president five times to use past reserves. We weren’t sure if we would have enough resources to recover from COVID, create jobs for our people, and look after our seniors. We didn’t know how deep a fiscal hole we would end up with.
Singapore Prime Minister and Finance Minister Lawrence Wong
Even as the Singapore Government grappled with the pandemic and its disastrous economic impact, it knew that “healthcare spending was rising year after year, and would continue to increase because of our rapidly ageing population”, said PM Wong.
Making a difficult choice and acting responsibly, the Singapore Government decided to raise the GST rate once the pandemic receded and signs of economic stability returned, he said.
“But we [raised the GST] with the Assurance Package to effectively delay the impact of the GST increase for the vast majority of Singaporeans — and we’ve enhanced the package over the years to further cushion the impact on the cost of living,” added PM Wong.
“We know that every bit of support matters, and we will always stand with you,” he said, repeating the promise he made in parliament a few days ago.
A “special SG60 package” in Singapore Budget 2025 provided “more help for every Singaporean”, said the prime minister.
He said in conclusion that the Singapore Government would do whatever was necessary to help the people through “these difficult times” and “for as long as it is needed”.
Being prepared for the future meant taking better care of senior Singaporeans and “gearing up for a bumpier ride in the coming years, as the world becomes more dangerous, turbulent, and unpredictable”, he said.
