See More on Facebook

Economics

Singapore refutes Oxfam report on its performance in tackling inequality

The Oxfam report criticised Singapore for spending “well below countries such as South Korea and Thailand” on healthcare, education and social protection.


Written by

Updated: October 10, 2018

The Republic may not spend as much as other countries on healthcare and education, but the outcomes it achieves in these areas are significant, and better than most.

Social and Family Development Minister Desmond Lee made this point on Tuesday (Oct 9) when he refuted a report which criticised Singapore for being “one of the worst-performing countries in the world at tackling inequality”.

The Commitment to Reducing Inequality Index, compiled by non-profit organisations Oxfam and Development Finance International, ranked Singapore 149th out of 157 countries – below Ethiopia and Afghanistan, and above Bhutan and Haiti.

The index measured each country’s commitment to reducing inequality by looking at its social spending, tax policies and labour rights.

The report said Singapore’s tax system was the worst in the world at tackling inequality because it “undertaxes wealthy individuals and corporations”. The personal income tax rate for top earners here is 22 per cent, while corporate tax is 17 per cent, both of which are too low, the report argued.

Mr Lee responded: “Yes, the income tax burden on Singaporeans is low. And almost half the population do not pay any income tax.

“Yet, they benefit more than proportionately from the high quality of infrastructure and social support that the state provides.”

He argued that while the report assumes high taxation and high public expenditure reflect commitment to combating inequality, it is more important to look at the outcomes achieved.

“We set out to achieve real outcomes for our people – good health, education, jobs and housing – rather than satisfy a collection of ideologically driven indicators.”

For example, 90 per cent of Singaporeans own their homes, and even among the poorest 10 per cent of households, 84 per cent own their homes, he said. “No other country comes close,” he added.

Mr Lee noted that despite the low amount, the Economist Intelligence Unit ranks Singapore second in the world for healthcare outcomes, and the World Health Organisation ranks the Republic’s healthcare system sixth in the world.

Similarly, in education, Mr Lee noted that Singapore’s students consistently outperform others in international rankings.

While Singapore does not have a minimum wage – another point of criticism – Mr Lee said it does have income support for low-income workers, generous schemes for worker training and a progressive wage model for certain low-wage jobs.

Both lower-income and median households here have experienced faster income growth over the last decade than those in most countries, he added.

“That we achieved all of this with lower taxes and lower spending than most countries is to Singapore’s credit rather than discredit.”

The report also criticised what it called Singapore’s “harmful tax practices”, such as tax incentives for companies that develop intellectual property, or firms that make investments in the maritime or finance sectors. It said such incentives help corporations evade taxes.

CIMB Private Bank economist Song Seng Wun, however, pointed out that these incentives help draw substantial economic activity and investments into Singapore.

“These tax policies are meant to promote economic development and promote Singapore as a hub in areas such as finance and logistics, which in turn creates jobs,” he said.

The report recommended that all countries develop national inequality action plans, which should be funded by increasing progressive taxation and clamping down on exemptions and tax dodging.



Enjoyed this story? Share it.


About the Author: The Straits Times is Singapore's top-selling newspaper.

Eastern Briefings

All you need to know about Asia


Our Eastern Briefings Newsletter presents curated stories from 22 Asian newspapers from South, Southeast and Northeast Asia.

Sign up and stay updated with the latest news.



By providing us with your email address, you agree to our Privacy Policy and Terms of Service.

View Today's Newsletter Here

Economics

US urged to comply with WTO ruling

The US, under Trump, has shunned several international organizations. The United States has challenged the authority of the World Trade Organization by ignoring a WTO ruling, and such a move may escalate trade tension with China, experts said on Wednesday. The WTO announced on Tuesday that the revised countervailing measures imposed by the US on imports of certain products from China were inconsistent with WTO laws. However, the US failed to comply with the WTO ruling and accused China of “using State-owned enterprises to subsidize its economy”. The WTO mechanism is what members use to settle trade disputes, and countries in most cases abide by the rulings made by the organization, said Xue Rongjiu, deputy director of the China Society for WTO Studies. “If member economies don’t follow this procedure, the rule-based global multilateral system will be damaged and thr


By China Daily
July 19, 2019

Economics

S. Korea may review military info-sharing pact with Japan

It is unclear how the ongoing trade dispute with Japan has affected the decision. A senior Blue House official said Thursday South Korea will review whether to renew a pact with Japan on sharing military information, if needed, according to a politician here. “For now, (the government) has a position to maintain it. It can be reconsidered in accordance with (relevant) situations,” Chung Eui-yong, director of Cheong Wa Dae’s national security office, was quoted by Rep. Sim Sang-jung, head of the progressive Justice Party, as saying during a closed-door meeting with politicians. Chung, during the meeting at Cheong Wa Dae, briefed the politicians on the government’s response to Japan’s tougher export restrictions against South Korea.Sim told reporters that she raised the issue of the bilateral General Security of Military Information Agreement (GSOMIA) in the meeting.


By The Korea Herald
July 19, 2019

Economics

S. Korea cuts growth outlook to 2.2%, key rate to 1.5% amid uncertainties

Japan’s export curbs had impact on drastic lowering of outlook: BOK chief. The Bank of Korea has slashed its forecast for this year’s economic growth to 2.2 percent, reflecting the negative impact of external uncertainties including Japan’s ongoing export curbs. It also carried out an earlier-than-expected base interest rate cut to 1.5 percent, embracing the monetary easing signals in the United States and other developed economies. “Considering the changes in economic conditions since the last outlook (announcement) in April, we have set the economic growth rate for this year at 2.2 percent and the consumer price inflation at 0.7 percent,


By The Korea Herald
July 19, 2019

Economics

US tourism feels trade war pinch

Chinese travel fell 5.7 percent in 2018, its first drop in 15 years.  Travelers from China are seeking alternative destinations amid the trade war with the United States, as travel industry insiders keep a close eye on the decline in the number of those visitors. China is the third-largest source of overseas travel to the US, producing 3.2 million visitors in 2017 and accounting for 8.2 percent of all overseas travel to the country, according to the US Travel Association. Travel is the top US industry export to China, generating a $29.8 billion trade surplus with the country in 2017 and accounting for 19 percent of all exports. In addition, Chinese tourists spend an average of $6,700 per trip, about 50 percent more than the average for international visitors. Chinese travel to the US fell by 5.7 percent last year to 2.9 million visitors, the first fall in 15 years, according to


By China Daily
July 18, 2019

Economics

Sino-Africa partnership holds much potential

China has increasingly looked to the continent as an integral part of its plans. Africa’s Agenda 2063, adopted by the African Union in 2013, clearly outlines Africa’s priority areas for economic growth and development, as well as the implementation plan to be achieved during the 50-year period. The framework provides a blueprint of opportunities for continued cooperation with global development partners such as China. Out of 54 African states, 53 have bilateral relations with China under the Forum on China-Africa Cooperation. China views its Africa ties as indispensable for the attainment of its Belt and Road Initiative, which was launched in 2013 as a strategic policy for global engagement. Under the auspices of the BRI, China has conscientiously made a detailed case for cooperation to facilitate a mutual development agenda between China and Africa. As of April, 37 African nations an


By China Daily
July 17, 2019

Economics

Korea says Japan’s arbitration process offer unacceptable

Seoul has taken Japan to the WTO with an official complaint. A couple of days ahead of the deadline set by Japan for South Korea to respond to its offer of a formal arbitration process over historical disputes, the office of President Moon Jae-in made clear Tuesday that it won’t accept the call. Cheong Wa Dae’s stern stance came amid Tokyo‘s threat of additional trade measures against South Korean companies. It heralds a possible deepening of the rift between the neighboring countries. “There’s no change in the government‘s position,” a senior Cheong Wa Dae official told reporters. Asked whether that means Japan’s demand is unacceptable, the official said, “Yes it is. I think that‘s clearly conclusive.” At the center of the latest Seoul-Tokyo stand-off is compensation of Koreans forced to toil at Japanese factories and mines during World War II. Korea was under Japan


By The Korea Herald
July 17, 2019