Prime Minister Lawrence Wong defended the GST hike during his first Fullerton rally speech as PM on April 28, saying that it was implemented with “great care” to ensure fairness and shield lower- and middle-income Singaporeans.
PM Wong said the Government had explained in Parliament “with data and facts” why additional revenues were needed to support the country’s ageing population, but opposition parties chose to ignore these facts during the election campaign “to stir up unhappiness and maximise their votes.”
How the GST Hike Was Structured
The permanent GST vouchers mean that lower- and middle-income Singaporeans effectively pay less than the 9% headline GST rate, PM Wong explained.
“Who pays the full rate? Foreigners, tourists and higher-income families,” he said. “The opposition wants these groups to pay less. Would you? I wouldn’t.”
He stressed that the Government’s approach protects vulnerable groups while ensuring the system remains progressive and sustainable.
The GST was raised from 7% to 9% over two years, from 2023 to 2024 — a move criticized by the WP, PSP, and SDP, who are calling for a rollback to 7% or less to address cost-of-living pressures.
Responding to Opposition Criticism
PM Wong countered claims that the GST hike caused inflation, asserting that inflation pressures were largely imported due to overseas conflicts and global supply chain disruptions.
He said Singapore’s inflation has been coming down faster than in many other countries, thanks to sound monetary policies.
Delaying the GST increase would have weakened Singapore’s public finances, leaving the country unable to support seniors and shield citizens during economic crises, he added.
“We made the tough and responsible decisions earlier. That’s why today, we have the resources to support you and steer Singapore safely through this crisis,” PM Wong said.
On Minimum Wage and Economic Management
PM Wong also criticized opposition proposals for a universal minimum wage — such as the PSP’s proposed $2,250 minimum — warning it would increase business costs, push prices higher, and lead to job losses among lower-wage workers.
“How does this solve cost-of-living pressures?” he asked. “It will only make things worse.”
He cautioned that opposition manifestos were filled with “long wish lists” that sounded good but were not feasible, viable, or sustainable.
“If something sounds too good to be true, it probably is too good to be true,” he said. “There is no such thing as a free lunch.”
Preparing Singapore for a Changing World
Despite global uncertainties, PM Wong said Singapore has opportunities to benefit from supply chain reconfigurations, but a major economic restructuring will be needed.
To prepare Singaporeans, the Government will:
- Step up career counselling and job matching for new graduates.
- Strengthen the SkillsFuture system for workers to reskill and upskill.
- Support retrenched workers through the new SkillsFuture Jobseeker Support scheme, which offers payouts, coaching, and job training.
“If there are more retrenchments, there will be a safety net to help you and support you,” he assured.
PM Wong concluded by urging voters to choose experienced leaders to manage these major transitions, ensuring Singapore stays resilient and prosperous.
