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SINGAPORE – On Wednesday (October 14) a non-constituent MP in Parliament questioned the timing of the recently announced tax and fee increases.
During the debate on the government’s Covid-19 strategy, Leong Mun Wai of Singapore’s Progress Party said it is contradictory for the government to increase consumer costs while committing to supportive measures, and questioned whether the national coffers they were really overloaded.
He cited a recent two-week period in which cost increases were announced.
On September 29, it was announced that MediShield Life premiums will increase between 11.5% and 35.4% from the beginning of next year. That means an increase in annual premium from $ 1,000 to $ 1,350, Leong said.
The increased coverage that comes along with the increased premiums is “little consolation to Singaporeans who are still struggling with the financial woes of Covid-19,” said Mr. Leong.
On September 30, SP Group announced a 9.3 percent electricity rate increase for the last quarter of this year, from October to December.
“Here is a power grid monopolist who does not generate electricity, but has made billions of dollars since the electricity market liberalization in 2012, sparing no time in raising prices at the first available opportunity, even as Singaporeans struggle under the Covid-19 crisis, “he said.
While the price increase is due to the higher costs borne by power generating companies, Mr. Leong said that “SP Group could have easily absorbed the increase in past earnings it has made rather than pass the cost increase to customers”.
“The government does not inspire confidence by hastily increasing taxes and fees and at the same time promising measures to support Covid-19. Our population could view this act as ‘giving with one hand and receiving with the other,'” Leong said.
Leong also noted that the Land Transportation Authority (LTA) said last week that Road Electronic Pricing (ERP) rates on six gantries along the Central Highway (CTE) would be increased by $ 1 as of 12 October to ease peak period congestion.
These announcements add hundreds of dollars to the household expenses of average Singaporeans and raise concerns like the goods and services tax will increase shortly after 2021, Leong said.
He asked, “Can’t these increases be shelved for later? Can’t SP Group absorb the rate increases with their past earnings? Can’t they wait for ERP increases? Can’t premium increases be deferred for a period of time? one to two years, as after all, current insurance claims are still well below the premiums charged? “
In his speech, Mr. Leong also said that while the Government does not want to disclose the size of the national reserves for security reasons, it has released detailed annual financial information on Singapore’s assets and liabilities. “In its latest government financial statements at the end of March 2020, it was reported that we have a total of $ 1.35 trillion in financial assets,” he noted.
Taking into account the net contribution to investment performance, the returns on investments made with Singapore’s reserves, Leong said that the decline in Singapore’s financial assets is $ 14.8 billion, which means that “we have used only 1.1% of our total financial assets to fight Covid. ” -19 in 2020 “.
“It seems there is no need for the tax and fee increases to take place so soon,” he said.
Mr. Leong called for a review of safety net policies such as MediShield Life and HDB fixed lease, to build the confidence of Singaporeans to meet economic challenges and develop creativity, innovation and entrepreneurship.
“The role of the Government should be limited to being a facilitator and custodian of our funds, but the real work of building our future economy should be left in the hands of entrepreneurs and experts in different fields of the private sector,” he said.
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