In his Budget 2012 speech today, Finance Minister Tharman Shanmugaratnam announced that the government will help lower income and elderly Singaporeans by introducing a three-pronged permanent Goods and Services Tax (GST) voucher that will fully offset the seven percent GST that the lower half of retiree households pay on their expenses.
The GST voucher will come in the form of cash, U-Save rebates and Medisave top-ups.
A cash amount will be given to Singaporeans whose incomes fall within the bottom 40 percent and who reside in HDB flats or the bottom 15 percent of private home dwellers, which applies to private homes with an Annual Value (AV) of up to S$20,000.
A small amount of S$250 will be given to HDB homeowners each year, while those residing in private properties will receive a lower amount of S$100.
The second component of the voucher will comprise an annual top-up to the Medisave Accounts of older Singaporeans. Those above 65 and living in HDB flats or lower-end of the private property spectrum will receive this top-up. This is expected to benefit 85 percent of all elderly Singaporeans.As an example, Mr Tharman highlighted that a 75 year old Singaporean will receive S$350 if he lives in an HDB flat, or S$250 if he lives in a lower-end private property. Finally, lower- and middle-income households will benefit from permanent U-Save rebates, to offset part of their utilities bills.
Those living in smaller one- and two-room HDB flats will receive S$260 per year, which is equivalent to about three to four months of their utilities bills on average. Overall, the U-Save rebates will benefit about 800,000 Singaporean households (or 75 percent of all households). Related Stories:Innovation is key for construction productivity: Khaw HDB to be more active in IRH scheme
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