Do you agree that raising GST to 7 per cent is the best strategy for Singapore? How will this affect your business, and businesses in Singapore generally?

NOT being privy to the government's tax strategy for Singapore, we can only conjecture that this increase in GST is part of the government's longer-term plans to restructure Singapore's tax regime away from income tax and towards direct and consumption tax regime. But I feel that there has to be a balance between the two types of taxes. GST tends to be regressive for the general populace, especially when it comes to daily essentials and medical expenses.

While a lower corporate tax may make Singapore more competitive, a higher GST will also result in higher cost of living and inflation. So while a company may save on lower corporate taxes, it will be faced with higher costs. Whether the right GST is 7 per cent or another percentage will need careful study by the economists.

- Wee Piew
CEO, HG Metal Manufacturing Ltd