Chart of the Day: No tax policy changes amidst COVID in SG

SG and Myanmar are the only ASEAN countries that didn’t carry such a measure. 

Singapore was the lone maritime ASEAN country that didn’t implement tax and contribution policy changes amidst the pandemic, data from the Asian Development Bank’s Southeast Asia Rising from the Pandemic report showed.

The country also did not have loan guarantees by the state, benefitting private borrowers.

These two measures, however, are important in a country’s economic recovery phase, ADB said, adding that economies should exercise greater fiscal prudence to contain budget deficits and public debt.

“It is expected that some priority spending—such as investment in the health-care system, stronger social protection measures, and support to the MSME sector—will continue to be critical during the economic recovery phase,” the development bank said.

“Therefore, strengthening domestic resource mobilization either through stronger tax administration, the introduction of new taxes, and review of tax expenditures is important,” it added.

Targetting and developing a stronger partnership with the private sector would also be helpful to pro for some of the aforementioned public services, ADB said.

“Going forward, policymakers in the region should also focus on strengthening macroeconomic fundamentals and correct existing economic and financial imbalances,” ADB said.

Based on ADB’s data, Singapore was able to implement five of the seven fiscal stimulus packages identified by the ADB as important measures including health system measures; income support measures for individuals and households, excluding tax and contribution charges; public sector subsidies to firms; deferral of taxes and social security contributions and bringing-forward expenditure within the current fiscal year; and public sector loans or capital injections to firms