"I do not believe that Singaporeans would be willing to pay the taxes that Scandinavians pay, or that our economy could be competitive at such heavy tax rates." - PM Lee, Speech to ESS [Link]
You look around at friends especially those with talent who have immigrated to other countries. Where have they gone? Most of them have gone to Australia, New Zealand, Canada etc, countries with higher taxes and better social safety nets than Singapore. The most competitive economy in the world is Finland[Link] and it has a proper progressive taxation system that results in more equal society. Highest income earners and corporations in Singapore pay low income taxes - under PM Lee as Finance Minister, he cut income tax for the highest earners and corporate taxes and raised the GST. He also eliminated inheritance tax when nobody called for it. Companies pay low corporate taxes but we pay a lot at the worse times of our lives - when you're sick, when you're old and need support, when you're poor. The worse combination being old, sick and poor. When you have someone who is disabled that you have to support and you need a car to help him get around - that is when you really pay.
"We face a fundamental choice as a society - do we want low taxes and targeted welfare benefits; or high taxes on all and comprehensive welfare? Singapore has chosen the first; the Scandinavians the second." - PM Lee
Actually the choice is not between "high taxes for all and comprehensive welfare". PM Lee again puts up a false choice - most economists suggest progressive taxation i.e. those with the highest earnings pay more. What he has done in the past was to cut corporate taxes and income tax for those in the highest bracket and then later his govt did things like cutting healthcare subsidies for the middle and lower middle class(remember means testing?), The poor in Singapore ended up paying more taxes when he raised the GST. Parents with special needs children ended paying more[Link] Many talented individuals have voted with their feet leaving Singapore. PM Lee claims that this "choice" is made by Singaporeans when actually it is made by his govt. PM Lee chose to do all this at a time when corporate profits as a % of GDP was reaching historic highs and our income gap was growing.
What the PAP govt has done is amplify the inequalities in our society through the taxation system. It creates a big gap between the needs of the people and the ability to meet those needs. The PAP govt euphemistically calls this self-reliance:
By importing cheap foreign labor, he undermined the ability of a large segment of the population to support themselves and their family. His govt then implemented Workfare as workers' salaries fall to levels below what they need to subsist and this was not needed in the past when workers make enough to support themselves and their families. Workfare is in fact a subsidy for employers paying low wages and incentivise their low wage low productivity approaches locking the low wage worker in his menial job and a lifetime of poverty and eventually he will not be able to have a proper retirement. Today if you open your eyes when you eat the food courts and hawker centers, you will see our working elderly going from table to table to clean the mess you left them. Every day we see poor Singaporeans digging the trash for aluminium cans to eke out a living. You call this dignity? A worker who works a full time job and cannot earn enough to support his family because there is no minimum wage in Singapore....what does that do to his sense of dignity and self-worth? By importing labor from developing countries to keep wages depressed and allowing our income gap to grow to be the highest among developed nations, the PAP has undermined the Singaporean labor force that was once so proud to be named the number one workforce in the world. If the PAP govt keeps its policies, a sense of anger will soon overrun the sense of indignity. Singaporeans know that their self-worth comes standing together as a people to help those who have fallen due to bad govt policies. In an indirect way the PAP govt forces Singaporeans to close ranks, find our courage to stand up against their system. The sense of dignity will come when we find our voice as a people, regain our democratic rights and empower the ordinary people to bring about meaningful change in our society.