I honestly believe that an across the board GST percentage reduction will fare better at stimulating spending than targetd GST credits for the less well-off. 

A recent response to this on the ST forums was by a lady who felt that targeted GST credits would stimulate spending more than GST reduction.  However, I felt that she did not sufficiently substantiate why she thought so.  

There are a few reasons why I think an across the board GST percentage reduction would be better.  In line with her argument, there is a division between consumers who are more wealthy and those that are less wealthy.  By reducing GST across the board, there is an incentive to wealthier Singaporeans to continue spending.  They generally, in no small part due to their wealth, spend MORE, and spend MORE OFTEN, than Singaporeans who are less well off.   The less wealthy Singaporeans, also benefit from the across the board reduction, but at a lesser level as their expenditure is proportionately less.  

Pardon me if I sound a bit socialist; but reducing the GST percentage does help “redistribute” the wealth accumulated by those who are financially advantaged, to the local economy and HOPEFULLY, that would circulate and find themselves into the hands of those financially disadvantaged.

This is not to say Targeted GST credits will not work. But it is not stimulating spending directly, especially spending from those who actually have more money. Instead, a possible backfire is that the less wealthy Singaporeans would prefer to hold and save that money as part of their longer term effort to control expenditure. 

If we really HAVE to go one way with this, I’d say an across the board reduction would be more effective in increasing spending.  However, I feel that the less wealthy Singaporeans need a little helping hand as well.  Can these 2 solutions not run parallel at an adjusted level?