Experts Predict Tax Hikes For GST, Online Shopping And Cryptocurrency In Budget 2018
The sweet shopping deals we find online, ain’t gonna be sweet no more. Or so experts are warning, after tax hikes expected in Budget 2018 are released on 19 Feb.
In the near future – a hike in GST to a rumoured figure of 9% may not be our only concern.
At least, according to Today’s article on Friday (12 Jan), which consulted numerous financial experts on their predictions for our upcoming taxation policies.
Are you ready? Take a deep breath and let’s hope our blood pressures don’t spike along with these 3 other predicted tax hikes.
1. Say goodbye to cheap Taobao deals
Avid online shoppers would know that our literal Internet of Things, has so many things on offer that shopaholics have already whipped out their credit cards.
With experts predicting a likely increase in taxes for e-commerce, shoppers may need to resist the urge in the near future.
Because online shopping has seen exponential growth in recent years, offline retail in Singapore has been suffering from a drought of customers.
One reason why online shops provide excellent deals is because GST is not chargeable on their products.
An increase in GST will thus give “online retailers an even bigger unfair advantage” according to Mr Chua Hak Bin, senior economist at Maybank Kim Eng Research.
And how do we counter such a disparity? Tax e-commerce of course!
There goes our $19.90, free-delivery jeans.
With that being said, e-commerce is not the only thing that runs the risk of being taxed in 2018.
2. Taking a bit out of Bitcoin
The mere prospect of earning thousands from Bitcoin, has enticed almost everyone to jump onboard the cryptocurrency wagon.
Though notorious for their volatile shifts in value, Bitcoin remains one of the most popular investments for people building a portfolio in cryptocurrency.
But if you’re looking to invest in Bitcoin too, be prepared. Cryptocurrency has yet to be classified as a specific type of investment.
All this may change soon, as cryptocurrency may be considered “a digital representation of value where the underlying asset is a virtual commodity”, if an expert from Ernst & Young Solutions is to be believed.
This means that when cryptocurrency is officially recognised as a commodity, Bitcoin investors should probably prepare to be taxed as well.
So even if you get rich from investing in Bitcoin, there’s still no easy way out from paying your due taxes.
3. Resurrecting estate tax
Tax on assets inherited from relatives or friends who have passed away, is a thing of the past.
Yet, experts believe that this policy may soon be resurrected to achieve our government’s goal of broadening our tax base.
Another rationale behind dredging up this long-dead policy, is to prevent the rich from getting richer and the poor from getting poorer — following the economic theory of “equity”.
This tax actually doesn’t sound so bad for most Singaporeans.
The government’s Robin Hood-like move may actually serve to neutralise our increasing income gap.
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The good news is that there’s still no official confirmation that these tax increments will take place — for now.
Though these predicted tax hikes are based on speculations by experts in the field, nobody truly likes the idea of having to fork out more taxes.
Yet, the hard truth is, we’ll have to deal with them eventually.
And there’s nothing more we can say about that.