How you know Singaporeans are really serious about microeconomics

If you have to pay a fine, say for incorrect behavior in public, the fine is defined as say “$250 plus GST,” where GST is a consumption tax similar to a VAT.

Think about it.  Presumably you derive consumption pleasure from the fined activity.  Paying the fine (stochastically) is, at the margin, equated with the return from other forms of consumption.  The other forms of consumption are taxed and thus subject to GST.  Therefore the fine-generating activity should be taxed too.


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