Pritam Singh clarifies WP does not support 'total removal' of GST, but opposes hike to 8 & 9%

The WP does not want to reduce GST to zero.

Sulaiman Daud | Fiona Tan | April 21, 2023, 10:38 PM

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Workers' Party (WP) chief Pritam Singh clarified his party's stance toward the Goods and Services Tax (GST), stressing that they were not against the GST nor have they been "debating [for] the total removal of the GST".

Instead, WP opposed the GST hike from 7 per cent to 8 per cent and then 9 per cent, the Leader of the Opposition said on Apr. 21, 2023, the fifth and final day of the debate on the Motion of Thanks to the President’s Address.

Debates over last few years has been over the hike, not the tax itself: Singh

Singh noted that Deputy Prime Minister (DPM) Lawrence Wong had "reopened" WP's approach to the GST during his speech in Parliament on Apr. 18. Wong had said:

"The Opposition has offered some revenue alternatives, but their sums do not add up. We don’t need to go through the detailed arguments again. But without the GST, which the WP still does not support, we will face a huge funding gap."

Singh circled back to this and said he found it "rather strange" as the "debate over the last few years has been about the GST hike, and not the GST per se".

He wondered why Wong chose to bring up this "specific point" during the current debate and not during the Budget debate earlier in February 2023.

"Even so, as the DPM spoke on Monday (Apr. 18), I wondered why the DPM would want to raise the GST question at this debate, because those questions ought to have come during the Budget debate.

Had the question on the Workers’ Party position on the GST per se been asked then, the answer would have been obvious."

WP accepts GST as policy positions have to evolve

Singh said: "Workers’ Party policy positions cannot be immutable and have to evolve with the political realities of the time."

Acknowledging that WP may not have supported GST when it was first introduced, Singh said the party now recognises the GST as "part of the system" and accepts it.

However, he added that this does not mean that WP will be accepting "every GST hike put forward by the government".

Clarified that WP has been opposing GST hike

Singh clarified that WP has been opposing the GST hike, but did not ask for the removal of the GST completely.

"The Workers’ Party went into the last general elections opposing the hike in the GST. We did not ask for the removal of the GST completely, since the GST has been an endemic feature of our tax system for many years."

At least from the time I entered this House, the Workers’ Party’s position concerned the necessity of GST hikes because the GST hurts the poor and middle-class the hardest."

He explained that a one per cent GST hike does not mean that the prices of goods and services will only rise by one per cent, but can be "compounded many more times, especially for basic things".

While Singh acknowledged the GST voucher scheme provided by the government, and that in February this year its cash component was increased by up to S$350, he said he had not been able to find an MOF statement that sets out in parallel how much this increae will offset the total GST expenses for a low-income family without elderly members.

"The Workers’ Party’s view is that if there are options to stave off this one or two per cent rise in GST to fend off concomitant price rises in basic things ... as a responsible opposition that has the welfare of Singaporeans at heart, the Workers’ Party has to ask, why not consider and debate them?

That is what we must be expected to do in this House rather than just accept whatever the PAP (People's Action Party) says."

We have not been debating total removal of GST: Singh

Circling back to Wong's speech on Apr. 18, Singh said:

"The DPM does not want the Workers’ Party to re-litigate the alternative ideas we raised to make up the GST hike by saying that the sums do not add up. I believe when he says this, he means the sums do not add up if you want to remove the GST completely.

But the DPM would be acutely aware that this House was never debating the total removal of the GST in the last session of Parliament, nor have we been doing so for as long as the DPM has been in this House."

Singh's clarification echoes Perera and WP statement

Singh's words put a cap on the GST debate that had taken place over the past couple of days.

On Apr. 19, WP MP Leon Perera gave his speech, and said that his party presents serious and credible alternative plans from the government.

April 20 - Ong Ye Kung makes his speech

On Apr. 20, Health Minister Ong Ye Kung responded to Perera in his own speech, and said that the WP often "wants more of what is already being done" when it comes to government policies, but that a key difference between the parties was their position on the Budget.

Ong then made a fateful comment that would spark off many long exchanges and debates:

"Because to do more, one has to spend more, and one has to say where the money is coming from. However, the WP never supported the GST system. So an alternate budget without the GST simply cannot work and is a non-viable alternative."

This led Perera to seek clarification after Ong finished his speech.

April 20 - Ong and Perera cross swords over whether the WP supports the GST

Ong asked if the WP could clarify whether they support the GST system as a whole or whether their position is that they support GST staying at seven per cent, but not at the increased rate of nine per cent.

He also asked if the WP is contemplating "not having the GST system," as he recalled that the WP has always been against the GST, although he said he could be mistaken.

If that's the case, Ong would say it "does not make sense", as it is neither viable nor serious, as it is a crucial source of revenue. However, if the WP accepts having the GST but not hiking it to nine per cent, the PAP would have a different view.

Perera said the WP "accepted the reality" of having GST, but at 7 per cent because of the substantial revenue generated, and abolishing it would involve too many other trade-offs. However, the WP opposed the hike to 8 and 9 per cent.

WP released a media statement to clarify its position later that night. It reiterated Perera's reply to Ong that WP "opposes the GST hike from 7 per cent to 9 per cent".

It added: "This position was articulated in Parliament repeatedly since 2018 when the GST hike was mooted; and is reflected in our 2020 GE manifesto. Since the GST hike was mooted in 2018, we did not call for GST to be lowered to 0 per cent."

Apr. 21 - Murali Pillai seeks answers

The next day on Apr. 21, Murali Pillai brought up the exchange between Ong and Perera and again sought clarification.

"As may be recalled, the Honourable Member Mr Perera mentioned in relation to GST that the Workers’ Party accepted the GST at seven per cent and conveyed this in 2018.

Now my interest is that I actually spoke about the Workers’ Party position from 1993, when the GST bill was being introduced, all the way to date. And I checked the Hansard. So I seek clarification from the Honourable Member as to when and where this position of the Workers’ Party was articulated."

In response, Perera referred to the 2018 debates in Parliament and said the WP opposed the hike of GST from seven per cent to nine per cent.

"At no point in that debate, did we call for the GST to be lowered from 7 per cent to 0 per cent," Perera said.

Noting that Pillai made reference to WP's position in the 1990s, Perera said:

"Mr Pillai makes reference to positions that were articulated by the Workers’ Party in the 1990s, I don't know whether it's fair to bring up positions that were taken the 1990s and have a debate about that.

By the same token I could bring up positions that the PAP has taken in the 1990s and table that for discussion here, such as the graduate mothers policy, such as votes for upgrading, for example."

Perera repeated that ever since 2018, no one in the WP called for scrapping the GST.

Apr. 21 - Murali Pillai explains why he brought up WP position from the 1990s

Pillai thanked Perera for clarifying that the WP's acceptance of the GST is to be implied from the fact that in 2018, when the two-point hike was put up for discussion, the WP did not ask for a reduction of the 7 per cent tax.

However, he pointed out that 2018 was not the first time that GST had been planned for a hike.

"It was actually being increased progressively from 3 per cent to 4 per cent, 5 per cent," Murali Pillai said, with GST bumped to 7 per cent in 2007.

He added that this "implicit decision to accept GST" was made in 2018, when the government proposed a hike to 9 per cent. Therefore, the gap between the two parties is a matter of two percentage points.

Perera responded and said if policy positions from decades ago were tabled for debate, the same could be done of PAP policies, but he didn't think that would be "constructive", as positions evolve over time.

Pillai then explained that his interest in raising this position of the WP from the 1990s is not unfair, because "what we need is clarity" on where the Workers' Party, or any party, stands on the issues.

"So if it indeed has evolved, then it would be incumbent on any party to make that position very clear, so the public understands where the parties are on these important issues," he said.

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