SINGAPORE: The wealthiest 1 per cent of households in Singapore hold about 14 per cent of the country’s total household wealth – a share that is “broadly comparable” to advanced economies with similar levels of wealth inequality, said Senior Minister of State for Finance Jeffrey Siow on Wednesday (Feb 25).
The top 5 per cent in Singapore hold about 33 per cent of the country’s household wealth, he added in his response to parliamentary questions about the Ministry of Finance’s recent data on wealth and income inequality.
“These estimates should be interpreted with caution, due to sample size limitations and potential under-reporting in survey responses at both ends of the distribution,” he said.
According to data published in 2024 by consulting firm McKinsey, the top 1 per cent of households across major economies, including Australia, Japan and South Korea, held at least 20 per cent of national wealth. In the United States, that figure was 35 per cent.
In all advanced economies, wealth inequality is higher than income inequality, since wealth accumulates over an individual’s life, said Mr Siow.
A significant part of household wealth in Singapore is held in owner-occupied housing and Central Provident Fund (CPF) savings, especially among lower- and middle-income households, he added.
“Our housing and CPF policies have enabled many Singaporeans to build their assets over time. This broad-based asset ownership helps to moderate inequality while strengthening long-term security and social stability.”
Wealth inequality in Singapore exceeds income inequality, and is broadly in line with other advanced economies, new findings from the Finance Ministry showed earlier this month.
Singapore's wealth inequality coefficient stands at 0.55, comparable to estimates for other advanced economies like the United Kingdom, Japan and Germany, which range from 0.6 to 0.7.
This marked the first time Singapore had published wealth data. Mr Siow acknowledged on Wednesday that wealth is “notoriously hard to measure”, especially for data on overseas or unlisted assets.
“To the extent that wealth at the top of the distribution is underreported, measured wealth inequality would be underestimated,” the ministry said at the time of the announcement.
Like other advanced economies, Singapore primarily relies on survey-based approaches to collect this data, said Mr Siow. “We have no plans at this point to seek additional legislative or administrative powers to require more granular asset disclosure solely for inequality measurement,” he said.
Singapore intends to track wealth inequality over time, and the next cycle of the household expenditure survey is planned for 2028, he added.
Responding to questions about whether the government has considered other forms of wealth taxes beyond property tax, Mr Siow said Singapore’s approach is to tax wealth in ways that are less susceptible to cross-border movement and tax planning.
“This is why we focus on less mobile assets like property and motor vehicles,” he added.
“We are mindful of intergenerational balance. Younger households who are accumulating assets should not be unduly burdened. At the same time, higher-value property owners should contribute more.”
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The top 5 per cent in Singapore hold about 33 per cent of the country’s household wealth, he added in his response to parliamentary questions about the Ministry of Finance’s recent data on wealth and income inequality.
“These estimates should be interpreted with caution, due to sample size limitations and potential under-reporting in survey responses at both ends of the distribution,” he said.
According to data published in 2024 by consulting firm McKinsey, the top 1 per cent of households across major economies, including Australia, Japan and South Korea, held at least 20 per cent of national wealth. In the United States, that figure was 35 per cent.
In all advanced economies, wealth inequality is higher than income inequality, since wealth accumulates over an individual’s life, said Mr Siow.
A significant part of household wealth in Singapore is held in owner-occupied housing and Central Provident Fund (CPF) savings, especially among lower- and middle-income households, he added.
“Our housing and CPF policies have enabled many Singaporeans to build their assets over time. This broad-based asset ownership helps to moderate inequality while strengthening long-term security and social stability.”
Related:
Wealth inequality in Singapore exceeds income inequality, and is broadly in line with other advanced economies, new findings from the Finance Ministry showed earlier this month.
Singapore's wealth inequality coefficient stands at 0.55, comparable to estimates for other advanced economies like the United Kingdom, Japan and Germany, which range from 0.6 to 0.7.
This marked the first time Singapore had published wealth data. Mr Siow acknowledged on Wednesday that wealth is “notoriously hard to measure”, especially for data on overseas or unlisted assets.
“To the extent that wealth at the top of the distribution is underreported, measured wealth inequality would be underestimated,” the ministry said at the time of the announcement.
Like other advanced economies, Singapore primarily relies on survey-based approaches to collect this data, said Mr Siow. “We have no plans at this point to seek additional legislative or administrative powers to require more granular asset disclosure solely for inequality measurement,” he said.
Singapore intends to track wealth inequality over time, and the next cycle of the household expenditure survey is planned for 2028, he added.
Responding to questions about whether the government has considered other forms of wealth taxes beyond property tax, Mr Siow said Singapore’s approach is to tax wealth in ways that are less susceptible to cross-border movement and tax planning.
“This is why we focus on less mobile assets like property and motor vehicles,” he added.
“We are mindful of intergenerational balance. Younger households who are accumulating assets should not be unduly burdened. At the same time, higher-value property owners should contribute more.”
Continue reading...