Flogging the wrong horse

First, it was 3%, then it became 5%. Now it is going to be 7%. What are these percentages? Many Singaporeans would have known by now that the Goods and Services Tax (GST or otherwise known as the VAT in other lands) is going up again from 5 to 7%. The amazing thing is that no one, short of those in the know, were prepared for this. Not the rumour mill, which often are not too far from the truth, not from more reputable sources, where one can put greater credibility to the rumours. Well, most only knew when PM Lee made the announcement in Parliament last evening.

It is unpleasant news, especially when Parliament has been spending the last few days on the plight of the low-income people amongst us. This impending increase in GST will make it even more difficult for them as the GST applies to all goods and service, irrespective of whether you are from the low income segment, the middle or high income. It applies equally across the board. But of course, the government has thought about the effect on the low-income segment and PM Lee took pains to explain to Parliament that the government will come up with a package of mesures that will help this segment of the population overcome the increased financial burden. This was expected.

What caught my attention was how PM Lee hesitated when he mentioned the effect of the GST on the middle income people. He said, with seemingly much reservation, that this segment of the population will do OK. Now what does that mean? Does it mean that he acknowledges the raw deal that this segment of people have been dealt, but that they can work a bit harder on their own to overcome the inevitable rise in prices of goods and services across the board? Does that mean that the government has nothing in mind to help this segment of people, that they will have to swim on their own? His hesitant demeanor speaks volumes about the adverse effect the 2% increase will bring. Almost certainly, a rise in prices of goods and services beyond 2% is to be expected when we factor in the significant rise in oil prices recently. Retail establishments, and all business down the line, have held back so far, but the floodgates will now be opened, thank you very much, Mr Government.

The low-income people - the government will look after and the high-income people can look after themselves comfortably. The middle-income will be squeezed in-between and are expected to bear with it. How I wish more opposition politicians were in Parliament now to speak on behalf of the oppressed middle-class. In this context, Parliament has been flogging the wrong horse all this while. Why speak up for people which the government will help anyway? Why not speak up for the people the government does not seem to have any plans to help?

Image source: Don Monet's Studio