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Comment by dsizzle | Hacker News Reader

I was surprised she didn't cover the tax rate. I was curious, and I found that it's capped at 22%, and there's a 7% GST, so it's relatively low.

https://www.guidemesingapore.com/business-guides/taxation-an....

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Yes, but the tax rate alone is a bit misleading. They have a Central Providence fund that ever Singaporean has to contribute 20% of their salary to and it gets matched (i think that’s the rate) by the employer.

Then this big chunk of money is used to buy public housing, pay for public healthcare, fund retirement, etc.

So if you’re making $120k+ SGD, you’re in the 11.5% tax bracket, but 20% of your salary (starting at $0) is also withheld.

The lack of capital gains tax is pretty great though.

Oh, so there's a large employment tax that's paid by the employer? I'm confused by your use of "withheld", which implies you might get it back at tax time. Also, if it's paid by the employer than I wouldn't call it being "withheld", I would just call it a tax paid by the employer. In the US anyway, there's a similar tax on employment that's paid by the employer but you never see it on your paycheck. You do have to pay it if you're self-employed though. Is that true in Singapore as well?

It’s basically forced savings. 20% of your monthly pay is taken and put into an account. You can only use that money for certain things.

It’s like social security in the US but imagine if it was a bank account instead that you could access for retirement.

Also : Zero capital gains tax. Zero estate taxes.

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