The situation here is exacerbated by the recent spate of floods in Malaysia, driving up the imported costs of goods that Singapore gets from across the Causeway.
"You not only have externally-driven imported inflation because of global supply chain disruptions... The question is whether some industries and firms are in a position to pass on the higher costs, not just from the GST hike, but also from the build up of higher operating costs," said Ms Ling.In Singapore, families are facing higher prices in an array of goods and services, including for food, public transport and electricity.
For 36-year-old Vincent Li, he has observed price increases on a wide range of expense items, such as property tax, refuse collection fees, wages of foreign domestic workers, childcare school fees, online purchases and electricity bills. Mr Terence Yow, who is the managing director of shoe retailer Enviably Me, said that each of these cost components has gone up by two or three times on average, and costs have gone up by between 12 and 15 per cent across the board.
Describing food costs as “crazy”, Mr Tay said the price of one tin of cooking oil has gone up by 40 per cent. In addition to a bump in freight costs, he has to contend with manpower shortage. Besides difficulties in hiring foreign workers to replace those who have quit to return home, Mr Lim said his traditional reliance on part-timers has been affected, as many of them are now working as swabbers or safe distancing ambassadors.Mr Keson Lim, the director of toys distribution firm Being Kids, said that his business costs have jumped by 20 to 30 per cent.
He reiterated that he cannot adjust prices too much, as consumers are now more price sensitive than they were pre-pandemic, as some may have lost their jobs or suffered a drop in income. Like Mr Yow, Mr Lim said that if the current cost pressures persist, he would not be able to absorb the GST increase. However, he noted that the decision on whether to pass on the tax to consumers would largely depend on what will be announced during the Feb 18 Budget statement, and whether the authorities would further ease border restrictions in the next few months.
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