Budget - Tax Changes - Beyond $160,000

If you earn less then $160,000 a year, your income tax rates aren't affected.

Here is the summary of increases for you high earning Whales.

Source: ChannelNews Asia, via Facebook

How much more will you need to pay? Work it out yourself, you five-percenters!

Or get your accountants to do it.

Or if you like, you can move to HK...

Budget - COE

I do not know if the COE premiums were ever intended to be a significant revenue stream.

Whatever the original intent, it is now.

COE (Vehicle Quota Premiums) contributed $6.1b to the government revenue in 2014.
It is expected to contribute a similar amount in 2015.

Source: ST interactive

At 9.5% of government revenue it is the 4th largest component of revenue after Corporate tax, GST, and Personal Income Tax.

And with the Budget proposal for 2015 projected to incur a deficit of $6.7b, the $6.1b from COE becomes critical... and indispensable.

Which means... the COE is going to remain with us for some time. the government can't afford to lose almost 10% of it's revenue!

Which means alternative schemes to tweak the COE is not likely to be adopted if they may adversely affect the COE revenue.

Or proposals to smoothen the COE supply will be assess with an eye on the revenue stream and whether it would be disrupted.

So if you are hoping for the COE to come down... be aware that the government is betting against you.

But you already know that.

[Afternote: ERP collection is just a drop in the bucket compared to COE premiums:

The Government collected S$152 million in Electronic Road Pricing (ERP) revenue last year, which is a dip from the S$160 million consistently collected in preceding years, said Transport Minister Lui Tuck Yew to Parliament on Wednesday (Mar 11).]

Budget 2015: CPF changes

What does the CPF changes mean for you?

The income ceiling for CPF contributions will be raised from $5,000 to $6,000 from next year onwards.

An additional 1 per cent interest will be applied to the first $30,000 of CPF savings for those aged 55 and above next year, on top of the existing 1 per cent extra interest on the first $60,000 of savings. This means that the first $30,000 in Special, Retirement or Medisave accounts can earn up to 6 per cent interest.

First the easy details.

If you are over 55 and intend to leave at least $30k with CPF, you get another 1% interest.

Let's say you leave $60k in there and $30k earns 6%, and the next $30k earn 5%. In one year, you earn $3300 in interest in total. In 10 years, at simple interest calculations, you get $33,000. Your $60k become $93k. Compounded, it would be a little over $100k. When you are 65.

Not too shabby, but how long will $100k fund your retirement? If you are frugal and live on $20k a year, your $100k will last you 5 years. Probably less with inflation.

Crystal Ball Gazing - Goat/Ram/Sheep

I'm no prophet.

Don't ask me for 4D numbers. If I know what's the winning number, I'd tell my mother. She buys 4D.

But here are some "Crystal ball gazing" based on trends or signs that are obvious. At least, obvious to me.

Why you would not vote for the PAP

If you were looking for a litany of sins committed by the PAP, this is not the blog piece.

Two years ago, I suggested a strategy for  the PAP.

Not to win back Aljunied, Hougang, or Punggol East. Those wards are for the WP to lose. Not for the PAP to win back.

Two years ago, I noted:

When they lost Anson, Potong Pasir, and Hougang, their basic strategy was to just flail away at their opponents until one was disqualified, one moved on, and... oh they still haven't won back Hougang.

The theme of that post is that the PAP doesn't have a strategy.

Who's afraid of the Minimum Sum?

You really shouldn't worry about the Minimum Sum. 

If you are earning at least $2500. 

On average. Over your entire working life. 

According to one report, young Singaporeans (in their 20s) earn an average of $3000.  Oh wait. That's wrong. It should be US$3060. Depending on the exchange rate used, that could be SGD3900 to over $4000.

Really? Young Singaporeans earn THAT much?

Yes. If you are a college graduate at least. That was the target group surveyed. (Still incredulous!)

OK. What if you are NOT a college grad? 

Can you meet the Minimum Sum with just your Special Account?

Don't call us poor... things?

There is (was?) a series on CNA on low income families, how they cope, how they are being helped, and the title of the series is, "Don't Call Us Poor".

Why?

I understand that from an informative and public education point of view, the series is commendable. I hear good things about it.

[As an aside, I haven't watched the series because I don't have a TV. Does that make me poor? Well, don't call me poor!]

But what's with the title of the series?

Are the titles below all implying a certain perspective or are there any differences?

1 "Don't call us Disabled"

2 "Don't call us Retarded"

3 "Don't call us Stupid"

4 "Don't call us Ah Bengs/Ah Lians"

5 "Don't call us Elites"

6 "Don't call us Lazy/Skivers/Shirkers/Slackers"

7 "Don't call us Poor"

8 "Don't call me 'Shirley'."

Letter of Disappointment

When you get a government job, I understand that you get a Letter of Appointment.

Similarly, when you are appointed to some role like a member of the CPF Panel of Advisors, I suppose you will get a Letter of Appointment.

So when you are discharged from that job or that appointment, do you get a Letter of Disappointment?

Maybe I am being unfair, but I really think the panel should all get Letters of Disappointment.

How you should respond to the CPF changes

The CPF Advisory Panel has made their initial recommendations and it is likely to be adopted (duh!)

What should you do?

If you are the low income earner who is unable to meet your minimum sum, most of the recommendations are of no help to you. And the option to withdraw 20% of your RA at 65 is not without costs.

It does provide you with a choice, but whether you want to exercise that choice will depend on your situation - do you have a need for that money at 65?

And that is for you to decide based on your personal situation.

For the gamblers in you, here's a tip. Or some scenarios to consider.

Tolerating Freedom of Speech/Expression

There are two positions.

You may believe that the freedom of expression is an absolute freedom to be unbounded by any limits or restrictions because any limits or restrictions would dilute or even render meaningless this "Freedom". As the British PM argued, the freedom of expression includes the right to offend.

Or you may believe that there are no absolutes. As someone once explained, "my freedom to swing my arm ends where your nose begins". Similarly, The right to keep and bear arms include the responsibility to practise firearm safety. And so the freedom of expression is necessarily bound by or should be limited by judicious and responsible exercise of that freedom. Pope Francis argues that Freedom of Speech must be practised without offending.

You may believe one or the other. The point of this post is not to convince you of one view or the other, or to argue one view or another. There are lots of articles arguing for one position or the other.

The point of this post is to point out that tolerance is dead. It is a recurring theme in this blog because we are becoming more intolerant. Because we are getting more educated, have access to more information, we think we are better informed, and that our "informed" opinions are correct.