SM Goh says plan for GST hike came after elections
By Asha Popatlal, Channel NewsAsia | Posted: 17 January 2007 1426 hrs

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ABU DHABI: With Budget Day coming up, all eyes and ears will be on the announcement on the Goods and Services Tax (GST), and offset package.

Commenting on any possible fallout, Senior Minister Goh Chok Tong said price increases would not be that big.

Speaking to media at the end of his 9-day official trip to Morocco and Abu Dhabi, Mr Goh was reluctant to reveal any details of the GST package.

He would only say there would be measures to mitigate immediate price increases, with the aim of long-term economic growth to push up wages.

However, he did address perceptions about such unpopular moves being introduced after elections.

"That's not quite wrong. That's politics. That's the way campaigns should be fought. You concentrate on what you want to do – the positive parts. And of course, in some instances, you have to raise revenue to support the programmes. And after the election, you have got to translate your pledge into reality," said Mr Goh.

Mr Goh also revealed that the idea to raise the GST came much later.

He said: "I'll tell you quite candidly and honestly – during election time, the idea of GST had not come in yet. Because we just thought – we've got to do the Workfare bonus, we'll look at the sums later on. And we find that it's better for us to raise GST, not just for the programmes, but for anything we want to spend more on – education, for example."

What is important though, he said, is that at the end of a 5-year term, the pain must produce good results, with everyone saying it was worth it. - CNA/so