Inflation: Prices of food, transport & education have risen the most in Singapore in the last 20 years
Inflation is a word that has been frequently mentioned over the past few years, especially since the COVID-19 pandemic and Russia’s invasion of Ukraine have affected the global economy since 2020 and 2022 respectively. How exactly the prices of different items have changed over the past 20 years, and which ones have seen the greatest leaps?
That was the focus of a recent piece on the finance site dollarsandsense. It showed that the prices of education (75.7 percent), transportation (67.2 percent), and food (58.9 percent) have gone up the most since 2022. At the other end of the list, the price of clothes and shoes has gone up by only 1.1 percent in the last 20 years, dollarsandsense says. The rest of the list is as follows:
- Healthcare costs are up 53.6 percent
- Utilities and other fuel costs are up 51.3 percent
- Accommodation costs up 39.7 per cent
- Household durables and services items are up 25.3 percent
- Recreation and culture items are up 17.8 percent
- “In general, your bowl of $2.50 fishball noodles in 2002 would cost $3.97 today,” the article notes
How do Singapore's poor families get by?
Nurhaida, 29, who is unemployed with six children in Singapore, says it is difficult to make ends meet
Nurhaida Binte Jantan is making dinner. She is roasting otah-otah, a Malay dish of fish paste wrapped in banana leaves, over a portable stove.
She is a 29-year-old unemployed single mother with six children from five to 13 years old. She lives in a tiny flat, just 30 square metres, with little furnishing. There is no dining table, so the children eat their otah-otah with rice and chillies crouched on the floor.
The children share the single bedroom - their only bedding is mattresses and thick blankets. Nurhaida sleeps on the sofa in the living room.
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Overview of GST Rate Change: 8% to 9% with effect from 1 Jan 2024
In Budget 2022, the Minister for Finance announced that the GST rate will be increased from:
- 7% to 8% with effect from 1 Jan 2023
- 8% to 9% with effect from 1 Jan 2024
The revenue from the increase in GST will go towards supporting our healthcare expenditure, and to take care of our seniors.
Singapore's property tax revenue expected to increase by S$600m due to higher home valuations
Singapore's residential property tax revenue for 2024 is expected to be around S$600 million (US$446 million) higher than what was collected in 2023, said Second Minister for Finance Chee Hong Tat on Tuesday (Feb 6). Around two-thirds of the increase is contributed by non-owner occupied properties, he added.
Mr Chee was responding to parliamentary questions by Leader of the Opposition and Workers' Party chief Pritam Singh, who asked how much additional property taxes the government expects to collect in 2024, following the announcement in November last year that such taxes for most homes would go up again. In a follow-up question, Mr Singh also asked Mr Chee to clarify the difference between the additional S$600 million expected and an estimate given at Budget 2022, when Finance Minister Lawrence Wong said Singapore’s property tax revenue was projected to go up by about S$380 million after a two-step hike to the tax rate.
Mr Chee, who is also Transport Minister, said the higher than expected tax collection for 2024 was largely due to higher annual values (AV), that arose as a result of higher market rentals for residential properties. Property tax is calculated based on AV, which is the estimated annual rent of the property.
Property tax to go up for most homes again in 2024
Government will give one-off rebate of up to 100%
With property taxes for most homes set to rise once more next year, the government will provide a one-off rebate of up to 100 per cent to cushion the impact on affected property owners amid cost-of-living concerns. The rise in taxes involve both Housing Board (HDB) flats and private properties.
Property taxes will go up as market rents and annual values for most residential properties have risen, while property tax rates have also increased for higher-value private residential properties, said the Ministry of Finance (MOF) and the Inland Revenue Authority of Singapore (IRAS) on Thursday (Nov 30). The one-off rebate of up to 100 per cent applies to all owner-occupied residential properties.
The rebate will be tiered “to ensure that our property tax regime remains progressive, and those with greater means pay their fair share of taxes”, said MOF and IRAS. Property taxes for most homes similarly went up in 2023 following a yearly review of properties’ annual values, which are used to compute the tax payable by property owners. The government provided a one-off 60 per cent rebate for all owner-occupied properties then, up to a maximum of S$60 (US$45).
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Singaporeans face higher bills and fares as inflation bites
Passengers wait for a bus in Singapore. The city-state's bus fares will be raised in December. (Photo by Fumika Sato)
Public utility charges and transport fares in Singapore will be raised, starting this month, squeezing household budgets already strained by higher inflation.
"The cost of living in Singapore is getting too high. Buying and maintaining a car has become too costly, and now the water price, too. I can manage while I have income, but how will I live when I retire?" an engineer in his 50s lamented:
- The latest price increases began with transit fares. On Sept. 18, the government announced a 7% rise in public transportation fares, starting in late December, for buses and the Mass Rapid Transit (MRT) railway system. Fares will rise by 10 to 11 Singapore cents ($0.07 to 0.08) per ride for adults who pay by card and by 20 cents for those who pay in cash.
- The following day, Singapore Post announced a 65% postage increase, effective Oct. 9, for regular size letters and picture postcards to 51 cents. This was the first increase since 2014, excluding a 1 cent hike in January in line with a rise in the general sales tax.
- The first increase in water charges since 2017 was also announced on Sept. 27. It will be implemented in 2024 and 2025 and total 50 cents per 1,000 liters, rising to SG$3.24, up 18% from the current rate.
- Electricity and gas fees have been jacked up as well. Reviewing electricity charges every quarter, state-owned power and gas distributor SP Group raised household electricity charges by 3.5% for the October to December period compared with the previous quarter. Gas supplier City Energy, part of Keppel Corp., also carried out a 2.3% rate increase.
- Driving the increases in utility and transport charges is higher costs for things like energy, and rising wages. The headline consumer price index in the city-state climbed at its fastest pace in August and September of 2022, rising about 7.5% from the previous year. Inflation rose at a 4% clip in the latest reading in August. Nominal total wages grew 6.5% on average in 2022 over the previous year, according to the Ministry of Manpower.
Proposals to ease Cost of Living
Members of Parliament (MPs) on Tuesday (Nov 7) debated for over seven hours on how to ease cost-of-living pressures on Singaporeans in areas such as utilities, transportation and housing, before the House eventually approved an amended motion on the issue.
The debate had arisen from the original motion, filed by Leader of the Opposition Pritam Singh and his Workers’ Party (WP) colleague Louis Chua, that read: “That this House calls on the Government to review its policies so as to lower cost of living pressures on Singaporeans and their families”. Mr Liang Eng Hwa, MP for Bukit Panjang Single Member Constituency from the People’s Action Party (PAP), proposed amendments to the motion to read as follows: “That this House acknowledges that cost of living is a global concern, and calls on the Government to continue pursuing policies that together lower cost of living pressures on Singaporeans and their families, without undermining our fiscal sustainability and burdening future generations of Singaporeans.” While WP MPs as well as Non-Constituency MPs (NCMP) from the Progress Singapore Party (PSP) accepted the third portion of amendment on fiscal sustainability, they rejected the first two portions.
Mr Singh, who is also WP chief, acknowledged the various measures implemented by the Government, including rebates and hand-outs, to help Singaporeans deal with rising costs. However, he reiterated that his party disagrees with the continuation of status quo as the word “continue” might suggest, and urged the Government to review its policies as his party proposed various “structural changes”, which all eight WP MPs took turns to raise in Parliament. A total of 20 MPs — including two political office holders, both NCMPs from PSP and a Nominated MP — spoke during the debate from about 2.15pm to 9.45pm.
Plastic bags chargeable $0.05 from 3 July 2023
Major supermarket chains in Singapore have started charging for plastic bags, a government move designed to encourage shoppers to use reusable totes that is years behind countries including South Korea and Japan.
Beginning Monday 3 July 2023, around 400 outlets — or two-thirds of all supermarkets in Singapore — are required to charge shoppers at least S$0.05 ($0.04) for each disposable bag. The fee applies to bags of any material type, though plastic is by far the most commonly used material at major grocery stores such as FairPrice, Sheng Siong and Cold Storage. “Whether they are made of paper, plastics, or biodegradable materials, disposables have an impact on our environment during their production, transportation, and disposal,” Singapore’s National Environment Agency said on its website. Consumption of disposables will generate waste and carbon emissions, worsening the climate crisis, it said.
Under its Zero Waste Masterplan, Singapore aims to reduce the amount of waste sent to its only landfill each day by 30% by 2030. But compared with other Asian countries, Singapore has been a laggard when it comes to slowing down plastic consumption in stores. In Japan, a mandatory charge on plastic bags in all retail shops was put in place in 2020, while South Korea banned single-used plastic bags at major supermarkets in 2019. Thailand also banned single-use plastic bags at major stores in 2020.
Electricity, Gas & Water tariffs to go up
The electricity tariff will go up by an average of 3.7 per cent from October to December, national grid operator SP Group said on Friday (Sep 29). This translates to an increase of about 0.98 cents per kWh before Goods and Services Tax (GST).
It is the second consecutive quarter of increase, with SP Group attributing the rise in electricity tariff to higher energy costs compared with the previous quarter. For households, the electricity tariff before GST will increase from 27.74 to 28.70 cents per kWh. The average monthly electricity bill for families living in Housing Board four-room flats will increase by S$3.57 (US$2.60) before GST.
The gas tariff, meanwhile, will increase by about 2.3 per cent to 22.42 cents per kWh, announced City Energy.
New postage rates @ 51 cents wef 9 Oct 2023
Singapore Post Limited (“SingPost’ or the “Group”) today announced that the rate for standard regular mail will be increased by 20 cents to 51 cents, up from the current 31 cents to reflect the escalating costs of maintaining the postal service. The new rates are effective 9 October 2023. The last significant rate incrementwas nine years ago in 2014 when postage increased from 22 cents to 30 cents.
SingPost will introduce upcoming changes to simplify the domestic postage rate structure, including the elimination of the weight criteria, to make postal services more user-friendly, enhancing the customer experience and provide greater convenience. Starting from end-October 2023, SingPost will issue a 1st Local stamp booklet (of 10 stamps) to each household to help manage the postage increase. The global structural decline in postal volumes over the last decade brought about by digital disruption has impacted the commercial viability of postal firms globally. Between FY2018/19 and FY2022/23, mail volumes declined by more than 40%. This rate adjustment will help address the loss caused by the persistent decline in postal volumes coupled with costlier labour, utilities, fuel, and higher conveyance expenses.
This rate increment is necessary for SingPost to continue serving its obligations as Singapore’s public postal licensee while allowing further exploration of a more sustainable postal business model in the long term, balancing the need to remain viable while safeguarding the interests of its shareholders.
$0.75 to $3 to use Singdollar cheques from Nov 1
Singapore has announced plans to do away with paper cheques, starting with corporate cheques by end-2025
Are you still using cheques for your bills or other purchases? If so, you will have to start paying a fee from Nov 1.
The new fee ranges from S$0.75 to S$3 (US$0.55 to US$2.19) for each Singapore dollar-denominated cheque, according to the websites of seven banks as of Friday (Oct 20). These banks are DBS, UOB, OCBC, Citibank, HSBC, Maybank and Standard Chartered.
Fees will also be imposed on US dollar-denominated cheques, starting from US$0.55 to US$3. But the banks will be waiving these charges for individual customers aged 60 and above until Dec 31, 2025.
Bus & train fares to pay 10 to 11 cents more
The latest bus and train fare increases will more than double from last year's hike, which means adult commuters will pay 10 to 11 cents more per journey, the Public Transport Council (PTC) said on Monday (Sep 18). The PTC, which is the Singapore regulator for public transport fares, announced an overall fare increase of 7 per cent following the annual fare review exercise. The fare hikes will take effect on Dec 23.
The trend of sharper increases could potentially continue with the PTC again deferring a bulk of the fare adjustment quantum to future fare review exercises. This year's fare review exercise is the first under the new formula announced in April, which the PTC had said was aimed at keeping fares affordable and less volatile. As part of the review - conducted every five years - the fare formula was adjusted to include two fixed components to reduce swings in fare changes.
Adult card fares will increase by 10 cents for up to 4.2km and 11 cents for distances above that, while adult cash fares - used for bus rides - will increase by 20 cents. Adult monthly travel passes will remain at S$128. The 11-cent increase is the highest, according to the PTC, which pointed out that 2019 also saw a 7 per cent increase in fares, but from a lower base. A lower increase will be implemented for concession card fares for students, seniors, low-wage workers and people with disabilities. Fares in this category will go up by 4 to 5 cents per journey, depending on the distance travelled. Concessionary cash fares for bus rides will increase by 10 cents.
Singapore GST from 7% to 8% wef 1 Jan 2023
The Government will delay the planned Goods and Services Tax (GST) hike to 2023 and stagger the increase in two steps, Finance Minister Lawrence Wong said in his Budget speech on Friday (Feb 18). The first increase from 7 per cent to 8 per cent will take place on Jan 1, 2023, and the second increase from 8 per cent to 9 per cent will take place on Jan 1, 2024.
This comes after Prime Minister Lee Hsien Loong said in his New Year message in December that the Government will have to start moving on the planned hike this year, given that the economy is emerging from COVID-19. The plan to raise the GST by two percentage points, from 7 per cent to 9 per cent, was first announced in 2018 during then-Finance Minister Heng Swee Keat’s Budget speech.
Mr Wong said on Friday that the GST hike is necessary to support Singapore’s healthcare expenditure and to take care of its seniors. On the timing, Mr Wong said he has considered the overall situation – the pandemic, the state of Singapore’s economy and the inflation outlook. “Our revenue needs are pressing. But I also understand the concerns that Singaporeans have about the GST increase taking place at the same time as rising prices.”
Bus & train fares to rise wef 23 Dec 2023
For this 2023 Fare Review Exercise (FRE), the fare formula output derived from the new fare adjustment formula is 12.0%, driven by the continued increase in energy prices, core inflation and strong wage growth in 2022. After adding the deferred fare quantum of 10.6% from the 2022 FRE, the maximum allowable fare adjustment quantum for the 2023 FRE is 22.6%.
To keep public transport fares affordable in this higher cost environment, PTC has decided against granting the full quantum. Instead, PTC will grant an overall fare increase of 7.0%, which is about a third of the 22.6% maximum quantum. This is less than the 10.6% deferred from the 2022 FRE. PTC will defer the remaining 15.6%-points to future FREs. To cover this deferred fare adjustment quantum, PTC has requested the Government to provide an additional subsidy of about $300 million for this year’s FRE, which the Government has agreed to. This amount is higher than the additional subsidy of approximately $200 million that was provided after the 2022 FRE. The additional government subsidy will help to moderate the level of fare increase needed to keep pace with the higher cost of providing public transport while keeping fares affordable for commuters.
With this 7.0% fare adjustment, adult card fares will increase by 10 to 11 cents per journey. Adult cash fares, which are still accepted for bus rides, will increase by 20 cents. To better support vulnerable commuters, PTC has decided to implement a lower increase of 4 to 5 cents per journey for concession card fares while concessionary cash fares for bus rides will increase by 10 cents. About two million concession card holders will see a lower fare adjustment.
Singapore GST from 8% to 9% wef 1 Jan 2024
In Budget 2022, the Minister for Finance announced that the GST rate will be increased from:
- 7% to 8% with effect from 1 Jan 2023
- 8% to 9% with effect from 1 Jan 2024
The revenue from the increase in GST will go towards supporting our healthcare expenditure, and to take care of our seniors.
Proposals to ease Cost of Living
Tiered pricing for utilities and nationalising public transport among WP’s proposals to ease costs of living. Members of Parliament (MPs) on Tuesday (Nov 7) debated for over seven hours on how to ease cost-of-living pressures on Singaporeans in areas such as utilities, transportation and housing, before the House eventually approved an amended motion on the issue.
The debate had arisen from the original motion, filed by Leader of the Opposition Pritam Singh and his Workers’ Party (WP) colleague Louis Chua, that read: “That this House calls on the Government to review its policies so as to lower cost of living pressures on Singaporeans and their families”. Mr Liang Eng Hwa, MP for Bukit Panjang Single Member Constituency from the People’s Action Party (PAP), proposed amendments to the motion to read as follows: “That this House acknowledges that cost of living is a global concern and calls on the Government to continue pursuing policies that together lower cost of living pressures on Singaporeans and their families, without undermining our fiscal sustainability and burdening future generations of Singaporeans.” While WP MPs as well as Non-Constituency MPs (NCMP) from the Progress Singapore Party (PSP) accepted the third portion of amendment on fiscal sustainability, they rejected the first two portions.
Mr Singh, who is also WP chief, acknowledged the various measures implemented by the Government, including rebates and hand-outs, to help Singaporeans deal with rising costs. However, he reiterated that his party disagrees with the continuation of status quo as the word “continue” might suggest and urged the Government to review its policies as his party proposed various “structural changes”, which all eight WP MPs took turns to raise in Parliament. A total of 20 MPs — including two political office holders, both NCMPs from PSP and a Nominated MP — spoke during the debate from about 2.15pm to 9.45pm.
Coping with Inflation & Cost of Living 2014
$360 million to help households especially low income and retirees to cope with cost of living
There will be a special GST Voucher - Cash: Seniors' Bonus for Singaporeans aged 55 and above - effectively doubling the amount usually received.
Finance Minister, Tharman Shanmugaratnam explains: "Older Singaporeans are broadly most affected by increase in cost of living, especially retirees with little or no incomes."
The amount they will receive range from $100 to $250 depending on an assessable income of up to $26,000.
Expiring & Renewal of Electricity Contract
Renew your Electricity Contract with Tuas Power 36-month Fixed Rate and enjoy the following benefits:
- 0.2979 cents per kWh
- 50% Discount for 1st month
- 1-year free SingLife Home Insurance
- $20.00 Rebate using referal code RCB3672
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