Dear readers, in a recent post, I shared my views on the raising of the CPF Income ceiling, you can read about my views again here.
This topic of increase CPF Income ceiling was also discussed at a recent Parliament session and I have watched the key highlights of the session.
Deputy Speaker and MP, Ms Jessica Tan shared in Parliament during Budget debate, that a resident has shared that arising from the proposed higher income tax, the resident’s take-home pay will be reduced, especially in these times of higher daily prices of things.
Ms Jessica’s sharing is what I have mentioned in my above blog post and my comment on this is really based on a balanced perspective: having more contributions towards CPF will be good in the long run since there will be more savings of an individual earning good and generally low risk interests on a continuous period.
Unless the individual can really earn a much higher interest with the additional monies to be contributed to CPF arising from the higher CPF cap say through the stock markets, on a long-term basis (notwithstanding higher fixed deposits for now), then the compulsory additional income tax, for individuals whose income exceed $6,000 per month, in my opinion is generally good.
Another MP asked about whether the interest rate of CPF contributions should be revised if based on the intent of the proposed CPF income ceiling to ensure retirement adequacy in future and I thought this is a good question as well, watch the video below to find out more.
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