Sunday, October 04, 2009

Foreign worker levy is a fine

I have just received a letter informing me that I have to raise insurance coverage for my domestic helper. In principle, it is a good thing. I always saw it as a privilege to hire a live-in helper at a low rate, and I always find ways to pay more to my helper whenever I can afford it. I especially do not mind paying more for my helper's insurance, and I am glad I do not have to fret if I should give my helper a day off without making her wear a chastity belt. You see, the Singapore government, in their infinite wisdom, has decided it is no longer necessary to fine employers $5000 if their domestic helper get pregnant. I have no idea what employers do to be in compliance previously. Chastity belts, birth control pills or abortion pills? As a Catholic hiring a Catholic, my only option is chastity belt, but these stuff are kind of hard to acquire in a otherwise unbarbaric Singapore.

No longer needing to find a chastity belt, I have the free time to wonder about another barbaric rule by the Singapore government: the foreigner work and domestic worker levy. Why do we have to pay $170 (or more) levy a month to hire a domestic worker? To protect Singaporean workers? I am not sure how many Singaporeans compete for jobs with workers whose income attracts the foreign worker levy, but if the objective is to protect Singaporean workers, then it would only be logical to apply it to ALL foreigners, not just the lowest income workers? Why impose a tax against foreigners who do not compete with Singaporeans while giving a free pass to foreigners who do compete with Singaporeans?

Maybe it is an income tax then? At these rates, the taxes on the lowest income workers are easily around 35%, and are probably the steepest taxes imposed worldwide on the lowest income. On the one hand, Singapore is in danger of being a tax haven for the rich, but yet singles out the poor for high taxes. If we did not know Singapore government to be whiter than white, we would mistakenly think they are a reverse Robin Hood, robbing the poor to give to the rich.

For the steep taxes, one would expect some serious government services for such foreign workers. Then why do I have to pay for my helper's medical insurance and 6 monthly health inspection fee. She cannot make use of the services of our polyclinics. And if the worker absconds, would the government help? No. If the worker dies, would the government foot the costs to transport the body back home? No! The employer has to cover that. The government offers absolutely no services for the levied foreign worker, whatsoever, except for the privilege to work in Singapore.

So the logical conclusion is that it is a fine. It is a crime to hire someone who fails to qualify a higher work permit, and you get fined monthly.

1 comment:

  1. You are wrong here. The govt does take levy from employers of skilled workers too. Levy is not just for domestic helpers but for every foreigner working in singapore. Big corporates also pay levy.