Budget 2018 and recent budgets confirm one thing: our economy is in trouble.
In managing Singapore as a corporation, the PAP government should be able to generate revenue mostly from direct and indirect taxes. Instead, it has been increasingly reliant on contributions from “Investment and Interest” returns under the NIR framework.
While it’s fine to supplement revenue from other sources such as returns from state investments, it is ridiculous when NIR contributions become the biggest contributor of government revenue.
PAP’s reliance on NIR contributions is akin to a company CEO requesting Ah Kong for more funds to supplement dwindling revenue. Or face inevitable collapse.
Since 2000, PAP has been tapping on increasing NIR contributions to supplement government revenue. Hmm … an economy that has been booming but could not generate sufficient revenue?
Just how much have NIR contributions increased? When PM Lee took over from Lau Goh in 2004, NIR was $3 billion. Fast forward 15 years, NIR contributions have increased by at least 500% to $15.9 billion.
The PAP has already laid the groundwork for future NIR contributions increase because our ‘economic growth’ will not generate sufficient government revenue.
To confirm this, PAP has already planned to increase GST by 2% after GE2020.
That PAP needs to constantly supplement government revenue with other sources of income in a ‘booming’ economy can mean only one thing: our economy is in trouble.
Part of NIR contributions are in fact returns which belong to CPF members, not just Ah Kong money.
PAP has cleverly concealed this from propaganda loving citizens by legislating CPF as state reserves. All investment returns by GIC using state reserves subsequently belong to the government.