Singapore has many options to finance the growing needs: raise income tax or the goods and services tax (GST), or introduce new taxes such as a wealth tax or, as has also been speculated, an e-commerce tax.

Or, use more of the country’s reserves beyond the current limits.

Because the Government’s financial position is still very strong, it need not rush into a decision.

Will it use the time to gradually introduce a wealth tax, opening up another source of revenue for the future? Such a tax will have an added political significance: It will signal the Government is serious about tackling the growing class divide in Singapore.

This division is based not only on incomes, but on total wealth including assets such as property.

… Han Fook Kwang is also a senior fellow at the S. Rajaratnam School of International Studies, Nanyang Technological University

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