For Singaporeans receiving the additional GSTV (be it in Cash or U-Save), the feature of GST Vouchers in the recent Budgets is a welcomed support as cost-of-living increases. However, the GSTV is not a new thing for Singaporeans. In fact, the GST Voucher Scheme is a permanent scheme introduced since Budget 2012, more than 10 years ago.
Read Also: Assurance Package For GST: How Much Will Singaporean Households Be Getting Over The Next 5 Years?
GST Voucher Scheme Was Implemented To Offset The Regressive Tax Effects Of GST
Singapore’s tax system is generally progressive and the lower income earners receive more benefits compare to the taxes they pay and the higher income earners pay more taxes. According to the Budget 2012 speech, the top 20% of households pay 80% of income tax collected. However, Good & Services Tax (GST) is a tax on domestic consumption, which is a regressive tax, as it is a flat tax and will affect lower income earners disproportionately.
Instead, to offset the effects of GST on the lower income group, the Singapore Government implemented a series of temporary offsets to support Singaporeans through the transition when GST rate was raised from 5% to 7% in 2007. In 2012, the GST Voucher scheme was introduced as a permanent scheme to carry on the transitionary offsets and provide assurance that GST will not hurt the poor. It is one of the permanent transfer schemes that help lower-income Singaporeans benefit from our tax system.
The GST Voucher (GSTV) Scheme comprises four components that provide support for various household needs: Cash for immediate needs; MediSave for seniors to support their medical needs; U-Save to offset utilities bills; and S&CC Rebate to offset S&CC bills.
GSTV-Cash Provides Support For Immediate Needs For Lower Income Singaporeans
The most obvious form of support is cash and GSTV-Cash is the government’s way of supporting lower income Singaporeans for their immediate needs. The cash payout is paid out every August, and mainly paid via PayNow-NRIC.
To qualify for GSTV-Cash in 2024, you will need to:
be a Singapore citizen, residing in Singapore;
aged 21 or above;
have an Income Earned in 2022 as assessed by IRAS (Assessable Income (AI) for the Year of Assessment (YA) 2022) not exceeding $34,000;
have the Annual Value (AV) of your home (as indicated on your NRIC) as at 31 December 2023 not exceeding $25,000; and
not own more than one property
In Budget 2024, the GSTV-Cash is enhanced to $850 for eligible Singaporeans living in homes with AV of less than $21,000 and $450 for eligible Singaporeans living in homes with AV of more than $21,000 to $25,000.
Read Also: Annual Value (AV) Of Your Residential Property: Here’s How Its Calculated And Why It Matters
GSTV-MediSave Supports The Medical Needs Of Seniors
For seniors, medical care is one of the areas that requires more support and GSTV-MediSave addresses this with MediSave top-ups for eligible seniors. The top-ups will be credited directly into CPF MediSave account in August.
To qualify, you need to:
be a Singapore citizen, residing in Singapore;
be aged 65 or above in 2024;
have the Annual Value (AV) of your home (as indicated on your NRIC) as at 31 December 2023 not exceeding $25,000; and
not own more than one property
The MediSave top-ups are between $150 to $450, depending on the age and annual value of home. Note that income is not a factor for GSTV-MediSave and eligible seniors will continue to receive their GSTV-Cash if they qualify.
Read Also: 9 Ways You Can Use Your MediSave To Pay For Your Healthcare Expenses
GSTV-U-Save Supports Households’ Utilities Needs
Utility expense is something that every household incurs and one of the base expenditures that disproportionately affects lower income groups.
To offset the effect of higher GST rate on our utility bills, GSTV-U-Save rebates is given out to HDB households. This is a quarterly rebate on our utilities bills and is paid out in January, April, July and October each year.
Only HDB households are eligible for the GST Voucher-U-Save. To receive the GST Voucher-U-Save, your household has to fulfil the following conditions:
If your HDB flat is not rented out, there must be at least one Singapore citizen owner or occupier in the flat; or
If you rent an entire flat, there must be at least one Singapore citizen tenant;
And
If your HDB flat is not rented out, all owners and essential occupiers must not own or have any interest in more than one property; or
If you rent an entire flat, all tenants must not own or have any interest in more than one property.
The U-Save rebates will be credited directly into the household’s utilities account managed by SP Services and any unused U-Save rebates will be rolled over to help offset subsequent month’s utilities bills.
GSTV-S&CC Rebate Offsets HDB Household Expenses
Similar to utilities, Service & Conservancy Charges (S&CC) are one of the base expenditures that every HDB household incurs. To offset these charges, the eligible HDB households will receive GSTV-S&CC Rebates. This is a quarterly rebate and is paid out in January, April, July and October.
Initially given out as a temporary support measure, the S&CC rebates was rolled into the permanent GSTV scheme from FY2022.
Only Singaporean households living in HDB flats are eligible for the GST Voucher (GSTV) – S&CC Rebate. To receive the GSTV – S&CC Rebate in 2024, you must fulfil the following criteria:
There must be at least one Singapore citizen flat owner or occupier in the flat;
The flat owner(s) and essential occupier(s) of the flat do not own or have any interest in a private property; and
The flat owner(s) have not rented out the whole flat.
In general, eligible HDB households will receive between 1.5 to 3.5 months of rebates. As announced in Budget 2024, eligible HDB households will receive a one-off 0.5-month of S&UCC Rebate in January 2025.
Read Also: How Much Service & Conservancy Charges (S&CC) Do You Pay Each Month (And Rebates You Receive)?
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