Singapore soliciting feedback on its tax regime amid wealth disparity concerns
- After central bank chief Ravi Menon’s wealth tax comments, officials have been treading carefully, wary of spooking rich families or investors
- Low taxes have attracted tycoons like Facebook co-founder Eduardo Saverin and James Dyson, but inequality has widened, especially during the pandemic
While the government regularly consults various industry groups on fiscal policies, the talks around such taxes appear to have picked up pace following comments by the central bank’s chief in July that expanding levies on the rich may be needed to address wealth disparity.
Officials from the administration have met with members of Singapore’s business elite and advisers to the rich to gauge their reactions and understand concerns, according to people familiar with the discussions, who asked not to be identified because of the delicate nature of the topic. The discussions took place through official feedback sessions as well as unofficial meetings over meals, they said.
Singapore’s low taxes and stability have long attracted the world’s wealthiest, from Facebook co-founder Eduardo Saverin to James Dyson, the billionaire founder of the eponymous vacuum cleaning giant, making the city state a hub for private banking, family offices and asset management.
While more of the region’s ultra-rich have made Singapore their home during the pandemic, turbocharging its property market, many of its local tycoons have grown their fortunes alongside the country’s development.
The government is treading carefully as the issue has the potential to roil the city’s wealthiest families and spook foreign ultra-rich investors. While any new form of taxes would generate some revenue, a bigger objective is addressing a wealth gap that could breed public resentment, the people said. There were no concrete plans for how any levy might be structured or when it would be unveiled, if at all, they said.