Several major retailers in Singapore have agreed to absorb the 1% increase in Goods and Service Tax (GST) in 2023, as they hope to help consumers cope with rising prices.
GST went up from 7% to 8% in 2023 at a time when the high (inflationary) cost of living in Singapore is not expected to go down in the short term.
A major supermarket chain, NTUC Fairprice has announced that it will be offering a 1% discount for 500 essential items from January to June 2023, while another grocery chain, Giant operated by the DFI Group, will absorb the GST increase for more than 700 essential products in the same period.
Essential products include selected fresh foods and groceries such as rice, fruits like apples, toiletries and household items amongst others. These stores also offer discounts to senior citizens.
Meanwhile, another major retailer, Sheng Siong offers 1% ‘counter inflation discount’ for most of its grocery items for 3 months ending March 2023.
According to a local academic, retailers that absorb the tax increase might build goodwill with their customers and this could slowly translate to higher sales volume and more consumer traffic and loyalty in the long run.
