Look @ the following example :

Example 1

In 2006, if after rebates etc and your net taxable income is $60,000,the income tax you need to pay is $2,700 (8.75%). If you spend $800 amonth on needed goods and services, the GST paid for 5% will be $480Total=$3,180 in Tax paid.

In 2007, if after rebates etc and your net taxable income is $60,000,the income tax you need to pay is $2,600 (8.50%). If you spend $800 amonth on needed goods and services, the GST paid for 7% will be $672Total=$3,272 in Tax paid.From $3,180 to $3,272, the effective increase is 2.89%.

Example 2

In 2006, if after rebates etc and your net taxable income is $400,000,the income tax you need to pay is $61,650 (21%). If you spend $4,000 amonth on needed goods and services, the GST paid for 5% will be $2,400Total=$64,050 in Tax paid.

In 2007, if after rebates etc and your net taxable income is $400,000,the income tax you need to pay is $58,700 (20%). If you spend $4,000 amonth on needed goods and services, the GST paid for 7% will be $3,360Total=$62,060 in Tax paid.From $64,050 to $62,060, the effective decrease is -3.11%.

Example 3

In 2006, if after rebates etc and your net taxable income is $25,000,the income tax you need to pay is $187.50 (3.75%). If you spend $800 amonth on needed goods and services, the GST paid for 5% will be $480Total=$667.50 in Tax paid.

In 2007, if after rebates etc and your net taxable income is $25,000,the income tax you need to pay is $175 (3.5%). If you spend $800 a monthon needed goods and services, the GST paid for 7% will be $672Total=$847 in Tax paid.From $667.50 to $847, the effective increase is 26.89%.

The fact is: The poorer you are the more the GST is going to make you poorer
http://saynotogsthike.blogspot.com

SAY No To Goverment GST Hike to 7%
Singapore's Goods and Services Tax will be increased immediately by 2 percentage points next year, will depend on the economic environment then.
He also hints that the increase may be staggered over time, if the situation allows it.
If this happens, it will be similar to the last time when the GST was raised from 3% to 5%.
The increase then was staggered over two years.
Mr Goh was speaking to Singapore reporters at the end of a 10-day official visit to Europe.
The Senior Minister had left for Europe shortly after Prime Minister Lee Hsien Loong announced that details of the planned GST hike from 5% to 7% will be out on Budget Day in February next year.

the gst increase is going to make ppl suffer it wun do anything by increasing the gst it will only burdenised the peoples income problem. salary dun rise but rise all this stupid gst fare prices it will bring more harm to fellow singaporeans. the goverment do things must think carefully suka suka raise but pay never rise.National wage councils should do a draft report on we singaporeans pay issue not just by rising without analysing it is too ridiculous.Tink lah THE WHITES DO THINGS everytime very ambitious they are like chao chao in the Romance of the Three kingdom.AMBITIOUS VERY STRONG KANYI

Trackback from emigrestudio:

Given the Singapore government’s announcement that GST will be increased to 7%, ever cost-conscious and mathematically inclined Singaporeans are planning their big item purchases before the increase kicks in sometime in July 2007. ...

Trackback from Balderdash:

Meanwhile, to make up for tax shortages, the poor can be hit with regressive taxes like GST and even a poll tax; unlike the rich they are unable to migrate and will be hit with the full force of these measures...

Trackback from http://suchvividjustice.blogspot.com/:

Asumming the above sentence is true,

where GST = 7%,

and poor = those affected by GST,

then, poor has just struck the Jackpot with GST 7%, 7%, 7%

Therefore, Feng Shui is good for all values of (n + 2),

where n is the original value of GST....

Singstats published GST revenue for past few years:
http://www.singstat.gov.sg/keystats/mqstats/ess/essa151.pdf

For 5% GST, hit 3.8 billion in year 2005. Imagin, how much can get from another 2%? about 1.6 billion.

So, even if it is to help the poor, much will go to them? If 1 million poor, each should get about 1600. If there is 1 million poor, gahmen doing a terrific job in producing poor people... 1 in 5.

Amazing, this is the best plan pm and his cabinet can think of after being paid millions of dollar....

The elites 'seems' right, "stupid pple...haha....".

Trackback from mr lim:

Ah? Like OMGWTFBBQ? What’s with all the big fuss about the GST hike? Some no-life, nothing better to do guy even set up a website just because of this;...

Trackback from Hear ye! Hear ye! : Low income and corporate tax = more investments? :

The worst argument in my opinion is that low income and corporate tax equals to more foreign investments....

Trackback from Say No to GST Hike:

I'm saying NO too. I think it is unnecessary to increase the GST especially with all the rising costs in Singapore....

Trackback from sei-ji rakugaki : Spin Doctors:

We are the best in this spinning business....

Trackback from sei-ji rakugaki : 7% GST:

I am glad the government is going to help the poor....

The government is not helping. It's the people who fork out the GST money that are helping. So typical of them to take credit for themselves.

Trackback from Ever So Often: The GST increase:

The GST is a consumption tax. That is, people are only taxed on the portion of their income that they spend. It is a regressive tax, placing a greater burden on the poor...

Yup, the more spending power you have, the less you're likely to feel the pinch.
Great way to help the poor and narrow the social divide....

Hm.. If all the ministers take a pay cut (I doubt they need the money as much as our poor, duh.), it'll more than fund these so-called social security programs, no?

The opposite of voting only 2 opposition members in is not TOTALLY voting all PAP out- like the US system, there is less of a monopoly with the other party having almost half the seats. This ensures a robust debate and makes it difficult for the government to do things without due consideration. Dont let this "it must be only black or white" argument fool you.

Trackback from Good Shit Happens:

until the day when I see that people will enjoy a proportionally higher income range in view of the ever-increasing costs of living, I am going to consider migrating soon....

I guess we can't stop it already !!!!!!

It is better now look forward and start to do study on managing our finance, getting more part time money.. see my favourite blogs for some useful blogs ...

Steven's Part Time Money Making Over the Internet (PASSIVE INCOME)
stevechrist2k.blogspot.com

Could all SG ppl, pls stand up and use the blog/internet power to STOP This from WALK OVER again by Increasing to 7% ???????

Trackback from The Kway Teow Man:

They talk a lot about doing more for the poor, but at the end of the day, they don't want to pay for it....

Somebody is posting stuff in my name. What's this about?

Sorry, I logged into my account and posted the trackback, but have no idea why it turned out to be in your name. Trying to get an editor to amend it. But do you mind having your post trackbacked here?

Hi Guofeng, no problem. Since it's been clarified, there's no need to modify it. It's just pretty unnerving to have someone else post in your name. The KTM finally understands why Perry Tong filed a police report. Thanks for the prompt response and clarification. :-)

Hmmm... I wonder if I should be filing a police report against the guy who's been impersonating me since I recently found out who he is.

Trackback from Simple is the Reason of My Heart: Who should pay for the poor Singaporeans:

Well, an analysis of who really pays for the poor Singaporeans. ...

Trackback from SG Entrepreneurs: Singapore GST to rise to 7%. Who will survive?:

Well, ultimately, how do the SMEs cope with it? ...

is there a chance for singaporean to hold a non political affiliate peaceful rally on GST?

Trackback from Lucky Tan - GST increase to 7% to help poor & old!!!:

Yes, to help the poor & old contribute to the PAP govt, the GST will be increased to 7%. As the old don't pay income tax, they have no chance to show their appreciation to the PAP govt, this GST increase will help them to contribute something....

Trackback from Speranza Nuova: GST League Tables - Singapore Compared:

Indirect taxation goes by many names, such as GST, VAT, Sales Tax or Consumption Tax. The Deloitte list covers more countries, although the Wikipedia list has more detail on features such as Reduced-Rate GST....

From economist point of view, increasing in GST is inevitable and sometimes good for the economy in short run. However, i still can't see the point how is that going to help the poor people.

Nazi? Oh sorry sorry. Wrong channel.....

Well, we should be thankful that they didn't increase it to 10% like in Indonesia and you just have no idea where the money goes....

Some other countries also have much more higher GST than Singapore...but as long as the government use it up properly...that's should be fine, i think....

Do you have any idea where your money goes? There are no public records laws in Singapore. You can't go up to a ministry and demand to see their documents. What makes you think that the money isn't going down a black hole?

Given the gahmen's penchant for trumpeting achievements, do you seriously think that they are keeping certain information for "strategic" purposes? If Temasek and GIC has consistently been able to generate 15% returns every year for the past ten years, it would have been headlines for years.

I wager that many things are going on that we don't know about, and the government isn't telling.

Isn't it better to hear that your money goes to helping the poor rather than for...ahem...covering some people's butts, I mean, humongous loses elsewhere?

The 7% isn't as bad as the lame excuse he gave. A real disgrace.

Yes, peasants must be grateful for the Emperor's mercies.

Trackback from A Gecko's Tale:

At every stage of the process, external goods and services are needed to bring production to the next stage. So every stage incurs a 2% increase in cost. A loaf of bread will not simply cost 1.02 times of the pre-increase price....

Trackback from mollymeek : Gahmen Comes Up with Brilliant Way to Help the Poor:

Of course, that isn't quite enough to help the poor. In order to be able to help the poor, the gahmen needs resources. So, the idea is to get the poor to help themselves!...

Trackback from Hear ye! Hear ye!:

After doing the math, I find it contradictory that a tax that penalizes the poor is going to be implemented to help the poor. It’s not even a case of robbing Peter to pay Paul; it’s a case of robbing Peter to pay Peter....

Someone said it's the "Many Helping Hands" approach to welfare. I thought it was voluntary :(.

Somehow, I think the government has a clutch mentality. They need money, they run to us with GST.

i dont get it.. seriously. someone, help me do the calculations. if say in an extremely impossible case, we have 20% population 'needy', them raising by 2% prolly will rake in few billions more, say 4 billion.

so $4,000,000,000 divided by 800,000 people. this works out to be $5,000 each. i don't think.. the needys get even close to $1,000. what do you guys think. done your own calculations?

-hairyfairy

I did the math already. You can read it in my original post, as well as some further calculations in one of my replies to comments.

http://aaron-ng.info/blog/robbing-peter-to-pay-peter.html

Don't forget that the low income group is affected by any price hikes due to the GST too. There will be packages to help them offset this, no doubt, but isn't it ironic that this package is partially contributed by those people it's supposed to help?

And how is this going to help close the income gap? The well-to-do are going to pay the same amount, but they're obviously less likely to feel the pinch than someone who's earning a pittance. If any, it's only going to push the middle-income groups down.

The well-to-do are not going to pay the same amount. They are going to pay the same rate. A big difference.

No amount of calculations will disperse the smoke. You need to bust the source of the smoke - the smokers.

lets just wait what sort of brillian welfare policies that our scholar can come up with..

wun be surprise if its same old idea of cut utilities fee or housing etc based on ur flat size...

imagine if i claim my chicken rice cost $100 and i only sold at $10 to poor ppl... now i sell them $8 as a welfare...

You ALL have no idea how much $$$ these gahment people are sucking into their fat salary every month, how come nobody ask for financial transparency in the "Elite"???

someone mentioned that someone's pay is "Peanuts", this is a good indication that there are much more $$$$ being sucked out at the backend. and you all silliporeans dont even know what that person is trying to say.

So, just sit down and accept your fate.

Realize that you are trying to get through to zombies living in a vampire state.

We need a cleric.