Rilek1Corner

Tag: income

  • How Much Do You Need To Be Above Singapore’s ‘Average’?

    How Much Do You Need To Be Above Singapore’s ‘Average’?

    Forbes has named Singapore as the third richest country in the world. This wealth is measured using the Gross Domestic Product (GDP) per capita. Simplistically, it adds up everyone’s income for the year – to obtain GDP – before dividing it by the country’s population.

    So how much should the “average” Singaporean be making based on this calculation?

    Read More: Singapore, world’s richest. At what cost?

    The golden number is $5,943!

    At end-2014, Singapore’s GDP was recorded at SGD390.1 billion with population size of 5.47 million (Singapore residents + foreign talents).

    Table 1: National Accounts and Population in Singapore

    FY2011 FY2012 FY2013 FY2014
    GDP(SGD mils) SGD 346,354 SGD 362,333 SGD 378,200 SGD 390,089
    Population (mils) 5.18 5.31 5.40 5.47
    GDP per Person SGD 66,816 SGD 68,205 SGD 70,048 SGD 71,318
    Income per month SGD 5,568 SGD 5,684 SGD 5,837 SGD 5,943

    Source: Singapore Department of Statistics 

    Is $5,943 the correct number as the average wage?

    As mentioned, GDP per capita is a simple method to define how rich a country is by understanding how much everyone in the population earns per annum.

    However, using the entire population is not a good gauge, as children, students and retirees are not working, and hence should be excluded from the calculation.

    Table 2: National Accounts and Labour Force in Singapore

    FY2011 FY2012 FY2013 FY2014
    GDP (SGD mils) SGD 346,354 SGD 362,333 SGD 378,200 SGD 390,089
    Labour Force (mils) 3.24 3.36 3.44 3.53
    GDP per Worker SGD 106,995 SGD 107,779 SGD 109,824 SGD 110,482
    Income per month SGD 8,916 SGD 8,982 SGD 9,152 SGD 9,207

    Note: The labour force comprise of people who are working or seeking work Source: Comprehensive Labour Force Survey, Ministry of Manpower

    Using labour force instead of total population will be more accurate since we are basing our calculation only on those who are working. In this case, average wages inclusive of CPF contribution would be SGD9,207 per month per person.

    Additional Clarifications: You should be adding any additional income received aside from your salary into this figure. 

    So what are your numbers telling me? 

    If you are like us, then this number may appear exceedingly high to you, perhaps even unattainable. Do not worry, you’re not alone.

    The median salary in Singapore is SGD3,770. That means the majority of us  are not earning the average, unless we have other source of income. This is normal, as income are usually skewed towards the higher income earners and thus medium hardly ever equates to mean.

    What you should make out of this number is that there is potential to increase your wages in Singapore. Unlike poorer countries, where your future growth in earnings would be easily capped by the low potential in the country, we do not lack this in Singapore. There is money to be made, somewhere and somehow, in Singapore.

     

    DollarsAndSense.sg is a website that aims to provide interesting, bite-sized financial articles which is relevant to the average Singaporean.

    Image from Benjamin Lim. 

    Additional clarifications:

    Some readers have commented that measuring a person’s income using GDP is not correct. They are right. There are two ways to calculate GDP. One is via an expenditure approach and the other is via an income approach. For this article, we have used the income approach.

    Typically, national income can be measured by adding up wages + rental + interest + business profit. This is a ballpark alternative to measuring GDP. As seen from the formula, wages is only one part of the equation for income. Most of the super rich (i.e. the top 5%) will make the bulk of their income from rental (rent of real estate), interest (returns from investments such as stocks and bonds and from business profits (dividends) and not their monthly wages. 

    Other income an individual received should also be included when considering total income. This includes any government subsidy. 

    Regardless of how balanced or lopsided the distribution of wealth is in a country, GDP per capita will always be higher than “average” income. That is because there are additional factors such as corporate tax (i.e. money paid to the government) and retained earning that will not go to the individual. 

    Lastly, this article is not meant to say that we should all aimed to earn about SGD 9207 per working adult. Obviously, that is not possible. Rather the point is to show that as a country, we are by no means poor, and in fact, could be seen as generating about SGD 9207 of economic value per person, on average. Whether the medium salary of SGD 3770 is right or not can be of the opinion of the individual readers. 

     

    Source: http://dollarsandsense.sg

  • Roy Ngerng: PAP Makes Singaporeans Pay High Taxes And Earn From It

    Roy Ngerng: PAP Makes Singaporeans Pay High Taxes And Earn From It

    The PAP government in Singapore keeps masquerading to Singaporeans that tax is low in Singapore.

    Indeed, the personal income tax that Singaporeans pay on a per capita basis is low – it is one of the lowest among the highest-income countries.

    However, what the PAP does not tell you is that Singaporeans pay much higher indirect taxes and high social contribution rates.

    In fact, Singaporeans pay more than 4 times higher indirect tax than personal income tax. Where other high-income countries pay about the same amount of indirect tax as personal income tax, Singaporeans actually pay more than 4 times more.

    Not only that, Singaporeans also pay more than 3 times higher social security into the Central Provident Fund (CPF) than personal income tax. Again, where other high-income countries pay much lesser into social security or on average, about the same as personal income tax, Singaporeans are made to pay more than 3 times more.

    In total, Singaporeans thus actually have to pay nearly 8 times more into indirect tax and social security than personal income tax. This is when other high-income countries only pay an average of about twice as much or at most four times as much than personal income tax.

    So, you see, it is not true that Singaporeans pay low taxes. The income tax rate is low but what Singaporeans have to pay into indirect tax and social security is nearly 8 times more, which is a lot.

    The PAP keeps saying that personal income tax is low and thus Singaporeans should be grateful. But this is how the PAP is trying to trick you. Personal income tax is low but it is not for you. Only a very small and select group of people benefit from the low personal income tax – the rich.

    Indeed, Singapore’s top personal income tax rate is the lowest among the developed countries – 20%.

    But do you know even the highest income earners in Singapore do not have to pay the top rate of 20%? In fact, for someone who earns US$300,000 a year in Singapore, he or she only need to pay 14.1% – which is much lower than what a similar income earner in the other developed countries have to pay, and is also the lowest among the developed countries.

    Not only that, when compared to the top tax rate of 20%, a US$300,000 earner in Singapore only needs to pay 70.5% of the top tax rate. This is the lowest proportion among the highest-income countries, where a similar income earner would have to pay an income tax of about 90% of the top tax rate. In other words, high-income earners get to get away with it, more than the other developed countries.

    In comparison, for the majority of Singaporeans, we have to pay 37% of our wages into CPF. As compared to the rich who only have to pay 14.1% of their salaries into tax, the majority of Singaporeans are sacrificing more than twice as much into CPF.

    There is the rhetoric that the CPF is not tax but as I will show you soon, the CPF is a tax and the majority of low- and middle-income Singaporeans are paying more than the high-income earners, the PAP among them, into tax.

    So, you see, personal income tax rate is low, sure. But it is not for you. It is only for the very rich. Not only is personal income tax low for them, it is the lowest among the developed countries.

    ‪#‎SayNotoPAP‬

     

    Source: Roy Ngerng

  • 12,000 Households Receive Financial Help But 360,000 Still Live In Poverty?

    12,000 Households Receive Financial Help But 360,000 Still Live In Poverty?

    According to GOH LI SIAN, RESEARCH AND ADVOCACY COORDINATOR, AWARE’s letter ”Most govt reports do not deal with policies’ budgetary impact” (Today, May 21) – “While these (Government) reports provide some helpful information, they do not tend to address the impact of budgetary policies per se. The statistics referenced in most of these reports relate to the social phenomena within these ministries’ remit, such as the level of crime or number of workplace accidents, rather than the allocation of expenditure under specific initiatives and policies.

    ComCare – no applications’ statistics

    The ComCare Annual Report is a welcome exception, as it shows how much money is given out under the various ComCare schemes. However, these statistics could be more comprehensive, since figures on the number of applications received are not released.”

    My curiousity was aroused by the above, as the ComCare statistics did give the number of applications for financial assistance and the success rate in the past – which apparently has disappeared, according to AWARE’s above letter.

    As I had just wrote “1 million living in poverty?” – I looked at the ComCare statistics to see how many needy families actually received financial assistance.

    15,699 households received ComCare financial assistance

    According to Social Statistics 2014  – the number of families that received ComCare Short-to-Medium Term Assistance was 12,535 in 2013.

    The number that received ComCare long-term assistance was 3,164 (I understand that this figure has remained at around 3,000 for more than a decade!).

    So, the total number on Short-to-Medium Term and Long-term Assistance was 15,699 (12,535 + 3,164).

    But 107,490 households per capita income $494

    Even if we do not talk about the bottom second and third deciles of employed households or the 3.4 per cent of non-retiree households with no working persons and 7 per cent of retiree households which may fall below the ComCare criteria of $650 household per capita income – the bottom decile alone had about 107,490 employed households with per capita monthly income of only $494 (including employer CPF).

    Only 15% of bottom decile received ComCare financial assistance?

    So, does it mean that only about 15 per cent (15,699 ComCare financial assistance divided by 107,490 bottom decile households) actually received ComCare financial assistance?

    Only 4% of those in poverty received ComCare financial assistance?

    If we relate this to the 360,000 (30 per cent) households) estimated to be in poverty – does it mean that only about 4 per cent (15,699 divided by 360,000) received ComCare financial assistance?

    Short-term financial assistance less than $200?

    According to the ComCare Annual Report FY2013 – $31.36 million was disbursed to 17,182 households on short-term assistance in FY2013 – with only 6,867 households remaining (still on) assistance as at 31 March 2014.

    So, does it mean that the average monthly financial assistance per household was less than $200 ($31.36 million divided by 17,182 = $152)?

    Medium-term financial assistance less than $250?

    Similarly, $24.34 million was disbursed to 8,774 households on medium-term assistance – with only 5,520 households remaining as at 31 March  2014.

    So, does it mean that the average monthly medium-term financial assistance was less than $250 ($24.34 million divided by 8,774 = $231)?

    Please tell us more

    Why can’t the ComCare annual report just disclose the average amount of monthly financial assistance per household?

    Win battles lose war

    Source: www.allsingaporestuff.com

  • Gilbert Goh: Join The Income Inequality Forum on 30th May At Bras Basah Complex!

    Gilbert Goh: Join The Income Inequality Forum on 30th May At Bras Basah Complex!

    Come and support our Income Inequality forum this coming Saturday 30 May from 230pm to 5pm at 04-41 Bras Basah Complex.

    We face a crisis situation now whereby our income growth lags behind that of inflation for the past decade. Our cost of living is also at the world’s highest this year.

    More than 200,000 Singaporeans still earn $1000 and below a month putting them very close to the poverty line.

    Yet, we have the highest number of millionaires in the world exaceberating the income gap we have between the have’s and the have not’s.

    A high income gap not only inhibits social mobility but also encourages social class division and strife.

    Come and hear our four keynote speakers Mr Osman Sulaiman, Ms Fatimah Akhtar, Mr Roy Ngerng Yi Ling and Mr Goh Meng Seng expound on the topic with some PMETs giving short accounts of what they face in the job market.

    Email [email protected] for a seat.

    Singaporeans supporting Singaporeans.

     

    Source: Gilbert Goh

  • Zulfikar Shariff: Apakah Melayu Singapura Betul-Betul Maju?

    Zulfikar Shariff: Apakah Melayu Singapura Betul-Betul Maju?

    Orang Melayu selalu ditipu dengan dakwaan bahawa bangsa kita makin maju, makin kaya, makin ramai yang berada. Kalau dulu kita tinggal di rumah kampung, sekarang tinggal di rumah flat.

    Kalau kampung, tanah kita, kalau flat, tanah HDB. Tapi takpelah kita percaya juga yang kita ni makin kaya.

    Sekarang dah ada kereta, semua ada mobile phone, dah boleh melancung. Kan bagus tu.

    Tapi kita perlu juga selidik jika orang Melayu makin “kaya” kerana memang benar kita ni kaya, kerana tidak ada diskriminasi, atau hanya kerana mengikut arus keberadaan.

    Kalau kita ingin tahu jika orang Melayu makin kaya, makin mewah, kita perlu bandingkan dengan kaum bukan Melayu di Singapura. Dan bandingkan perluasan jurang kemewahan: bila ia berlaku? kenapa? siapa yang memerintah?

    Adakah kemewahan ini melalui absolute gains (kerana dunia semakin mewah jadi kita pun mewah) atau melalui relative gains (jika dibandingkan dengan kaum lain, sebenarnya kita makin miskin).

    Adakah Melayu semakin mewah? Apabila PAP memerintah, siapa yang lebih mendapat habuan? Sama rata ke? Atau ada kaum yang makin mewah? Dan kita sebenarnya makin miskin?

    Menurut Lily Zubaidah Rahim, PAP tidak suka kita bandingkan kemewahan orang Melayu dengan bangsa lain kerana ia akan menunjukkan jurang yang makin meluas (23-24).

    The economic gap between the Malay and Chinese communities grew since the PAP took over.

    “the gap between Malays and Chinese in the two highest occupational categories was 2.3 in 1957, which increased to 4.1 per cent in 1970 and 9.6 per cent in 1980.

    Whereas there was approximately the same proportion of Malays and Chinese in the lower manual category in 1957, by 1980 there were 10 per cent more Malays in this occupational grouping. In the 1980s, the Chinese community continued to enjoy greater occupational mobility relative to the Malay and Indian communities…

    While there was a decrease of 25.3 per cent of Chinese male workers in the income category of less than $400 a month between 1975 and 1980, the proportion of Malays in that income category actually increased by 1.5 per cent in the same period.

    Whereas there was an increase of 5.9 per cent of Chinese male workers in the income bracket of more than $1,000 per month between 1975 and 1980, the increase for Malays was only 1.9 per cent…

    In 1980, the average Malay household income was 73.8 per cent of the average Chinese household income. By 1990, the income gap widened as the average Malay income dropped to 69.8 per cent of the average Chinese household income.” (20)

    Rahim, Lily Zubaidah. The Singapore dilemma: The political and educational marginality of the Malay community. Oxford University Press, USA, 1998.

     

    Source: Zulfikar Shariff