Tax the rich? 5 ways Singapore might tackle wealth inequality as it seeks inclusive growth

The Southeast Asian financial hub has been a magnet for the well-to-do thanks to its low tax rates and modern infrastructure

But it’s already planning to raise income taxes – and its next prime minister has indicated that the government needs to do more to tackle inequity

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Lawrence Wong, Singapore’s prime minister-in waiting and current finance minister, speaks during an interview on Monday. Photo: Bloomberg

Published: 9:03am, 17 Aug 2022

Singapore may impose more taxes on the wealthy as it seeks more inclusive growth, its next prime minister Lawrence Wong signalled in an interview.

The Southeast Asian financial hub, which has been a magnet for the well-to-do thanks to its low tax rates and modern infrastructure, is already planning to raise income taxes for its richest residents, as well as duties on high-end property and luxury cars.

Wong, who is also the city state’s finance minister and deputy prime minister, has indicated the government needs to do more to tackle wealth inequality as core inflation surges to a 14-year high.

Yet it’s a fine balancing act. Overtaxing the wealthy could make the city less competitive with other nations looking to lure top talent and assets from abroad and could be especially damaging to Singapore’s booming wealth management industry.

Condominium blocks in Singapore. The city state imposed further increases in stamp duties last year to cool the housing market. Photo: Bloomberg

Her are five options the government could consider:

1. Estate or inheritance taxes

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