Still, the government will go ahead with a planned two-stage increase in its goods and services tax (GST) from 7 to 9 per cent, Wong, who is also the finance minister, told local media.

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“It is likely that global inflation will remain high for some time, and may even increase further before it stabilises and gets better,” the ministry said in a statement.

“Likewise in Singapore, we must brace ourselves for higher prices over the next few months. In particular, energy prices are likely to continue to remain elevated over the second half of the year.”

As part of the package unveiled on Tuesday, adult Singaporeans earning less than S$34,000 (US$24,500) a year will receive S$300 in cash in August, with every Singaporean household getting S$100 in credit to offset household utilities.

Taxi and private car drivers will also get S$100 in August to help with the hike in fuel prices, while businesses affected by current headwinds also get relief.

Wong in April had said the price increases the country was experiencing at the time were not unique.

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The finance tsar, who recently was named the heir apparent to Prime Minister Lee Hsien Loong, at the time said he would bring forward some aid measures announced in the country’s 2022 budget, and had underscored that the government would monitor the situation and take additional steps if necessary.

In his remarks on Tuesday, Wong acknowledged anxieties over the recent price rises. Nonetheless, he said the GST hike had to go ahead given steeply increasing spending needs, especially those linked to healthcare and caring for the country’s elderly population.

This was why the government pushed back the hike “as late as possible” and is “handing out a generous offset package”, Wong was quoted as saying by Today Online.

“Most will not feel the impact for at least five years. For the lower-income groups, they will not feel the (GST hike) impact for 10 years,” he said.

Wong said the latest package was carefully designed so the stimulus “does not in itself spark more inflation in Singapore”.

“That’s why the package is weighted towards the lower income and more vulnerable segments in our society, who will bear the higher brunt of increased prices,” he said.

Food prices in Singapore rose by 4.1 per cent in April from a year earlier, up from 3.3 per cent in March. The central bank expects core inflation to surge further over coming months, with its latest forecast predicting core figures to average between 2.5 to 3.5 per cent this year.

Selena Ling, head of treasury research and strategy at OCBC Bank, said the S$1.5 billion package was timely given that the headline consumer price index had crossed 5 per cent. “Nearly six months of the year have passed and inflation has not peaked yet even though the inflation forecast has been raised since February,” she said.

With this support package, Singapore joins other Asian economies in putting forth additional measures to battle rising prices.

Indonesia has pumped an additional US$24 billion into energy subsidies, while Malaysia has said it would give direct cash assistance to low-income households and has also been subsidising petrol.