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Have you noticed that the cost of basic necessities like food, housing, and healthcare is rising more than what you are used to? You’re not alone. The impact of rising global inflation, higher interest rates, and supply chain disruptions has intensified the cost-of-living expenses globally, including for most Singaporean households.
In Singapore, the goods and services tax (GST), which was raised from 7% to 8% from January 1, 2023, will go up to 9% from January 1, 2024. To help more Singaporeans cope with the inflationary pressures and GST rate changes, the government enhanced the assistance provided under the permanent GST Voucher (GSTV) scheme and Assurance Package (AP) in this year’s Budget 2023.
#1 GSTV – Cash Quantum Increased By Up To $350 Over 2023 And 2024
The GST Voucher (GSTV) scheme is a permanent scheme introduced in Budget 2012 to assist lower- and middle-income Singaporean households cope with their higher GST-related expenses via cash support, Medisave top-ups, U-Save rebates and Service & Conservancy Charges (S&CC) rebates.
The GSTV – Cash component under the GSTV Scheme will be enhanced with a higher payout from 2023, as shown below.
Paid out in August annually, this enhanced support will benefit around 1.5 million eligible adult Singaporeans each year and cost the government around $530 million a year.
Read Also: GST Voucher (GSTV) Scheme: How This Permanent Scheme Supports Singaporeans As GST Rates Increases
#2 Assurance Package Boosted By $3 Billion To Address Immediate Cost-Of-Living Concerns For All Singaporeans
The Assurance Package (AP) is another support scheme that is meant to cushion all Singaporeans from the impact of the planned GST increases over a five-year period from 2022 to 2026.
To address immediate cost-of-living concerns, the Government increased the total amount of the AP by $3 billion, to $9.6 billion.
The enhancements comprise:
(i) Increase in AP Cash by between $300 and $650 for eligible Singaporeans over the remaining years of the AP and a further $100 increment to the CDC Vouchers to be issued in January 2024; and
(ii) one-off support relief such as a Cost-of-Living (COL) Special Payment of between $200 and $400 for each eligible adult, a COL Seniors’ Bonus of between $200 and $300 for eligible Singaporeans aged 55 and above, double the U-Save Rebates of up to $760 for households to be disbursed over the next three tranches in 2023, and a top-up of $400 to the Child Development Account (CDA) for children 6 and below, or $300 to their Edusave account or Post-Secondary Education Account for older children between 7 and 20 years old.
How Does This Benefit You?
Together, the enhancements to the GSTV Scheme and AP will fully cover the increases in spending due to inflation and GST rate increase for lower-income households, and substantially cover the increases in spending for middle-income households in 2023.
Putting this into context, a middle-income household with two young children living in a 4-room HDB flat will receive about $3,300 in 2023. Refer to the graphic below for a detailed breakdown:
The enhancements also ensure greater support for retirees and lower-income households. For example, a retired elderly couple, as depicted in the graphic below, could receive total support of $6,500 in 2023.
Large households will receive more support. A typical 3-Generation households, as highlighted in the graphic below, could receive total support of around $8,400 in 2023.
Find Out How Much You And Your Household Stand To Receive In 2023 (And Beyond)
The support from the AP and GSTV Scheme will be disbursed based on the eligibility of the individual and household. You can use the MOF disbursement calendar for a quick reference on when you can expect to receive the respective payouts from the various schemes, as they are spaced out over the course of the year.
Head over to the “Support For You” calculator that not only helps you estimate the benefits that you and your household can receive under the various packages and schemes but also highlights when you can receive them. This can be useful in helping you manage your finances.
The post How Budget 2023 Helps Singaporean Households Deal With Inflationary Pressures And The GST Rate Increase appeared first on DollarsAndSense.sg.
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