SINGAPORE: The Singapore Democratic Party (SDP) on Wednesday (Apr 9) called on the government to "immediately reduce" the Goods and Services Tax (GST) from 9 per cent to 7 per cent in view of US tariffs on Singapore and other countries.

"This will go a long way to help Singaporeans cope with the effects of rising costs that may develop with the imposition of the tariffs," the party said in a statement.

"It will also help to boost domestic consumption and keep the cost of living from rising further."

The tariffs, announced by US President Donald Trump on Apr 2, impose a universal 10 per cent tariff on all imports into the country, with higher rates for countries deemed to have treated the US "unfairly".

Singapore, which currently imposes zero tariffs on US imports, is still subject to the baseline 10 per cent rate.

SDP also called on the government to reduce prices and fees that were "increased over the last few years" back to pre-COVID levels.

It said that water rates, bus and MRT fares and ERP fees, among others, "must be brought under control".

The party said its call for the reduction in GST and other prices is consistent with its repeated calls to reduce the cost of living for Singaporeans.

"The action is timely as it is the first of a series of measures to restructure our economy to level up society and narrow income and wealth inequality in Singapore," it added.

"Singapore will be able to be resolute and united in holding its own in this troubled world only when the people who call this country home are adequately and meaningfully supported."

SDP's comments come after Prime Minister Lawrence Wong’s ministerial statement in parliament on Tuesday. Mr Wong announced that a national task force will be formed to support businesses and workers.

He added the sweeping new US tariffs could slow economic growth and affect jobs and wages. On Tuesday, the Workers’ Party (WP) called for all options to be considered in response to the tariffs, adding that Singapore should immediately start bilateral negotiations and that "no response should be ruled out, given the unprecedented nature of the act". The Progress Singapore Party on Wednesday asked the government to secure a new trade deal with the US, including “making adjustments to internal policies or making strategic investments in the US”.