The proof is in the pudding they say. In the case of our government trying to level the playing field between the rich and the poor, they seem to be tripping over the policies created by their predecessors.
No where on earth would a tax for a luxury car be lower except in Singapore. Well, this is the genius of our bureaucrats. Not too long ago DPM Tharman said that we have a progressive tax system. Like as if his words were jinxed, the COE prices for big cars plunged below those for smaller cars in the recent COE bidding exercise. So now we have a situation where the tax for a Ferrari is lower than the tax for a cheap Korean car. You need to give it to these guys, they have turned economic theories on the head. Or as depicted in the illustration, they have a car on their heads instead of a brain in their head!
But all is not lost. PAP MP thinks that this can be corrected while the car dealers think that the market will correct itself in the long run.
Chairman of the Government Parliamentary Committee for Transport Cedric Foo said, “with the loan curbs shifting demand to Cat A (cars up to 1,600cc) and with all the German marques there, there is upward pressure on premiums. If we don’t adjust supply, this is what happens.”
Maybe so but Cedric seems to have forgotten what I said before, “if the economy ain’t broke, don’t break it.” What we need is a set of policies that bridge the wealth gap. It seems to me that whatever measure they come up with are defeated because they have tinkered too much with the economic system.
In another article, I have also highlighted about how the Wage Credit scheme though well intentioned is not meeting the objective of raising the wages of the workers.