And the Budget 2011 did not disappoint its citizens.
At the same time, analysts are also looking out for signs of what will be increasing in the coming year.
Previously, GST subsidies will be announced to help all citizens cope with "soon to be raised" Goods and Services Tax. Such subsidies raises eyebrows as it is a sign of increasing GST in the coming year. And it so happens that in 2011, we are expecting an election. So the effect of giving out GST credits will have adverse impact on the election results.
So it was announced before the budget that the public transport fares will not be increased. That might mean that the price of fuel may be kept constant for a while to ensure that the public transport companies continue to be profitable without being affected by increasing fuel prices. If that is true, that will mean that utilities will also be kept constant since utility bills are rated in ratio to the prices of fuel.
So if fuel, utilities and public transport are not going to go north, what will the future be for this country? As we know, the budget gives in advance what it will be taking back within the same year. Much $$$ has been given for improving the birth rate and scrapping the TV and Radio License and this will create a huge debit to the nation.
My conclusion is that GST will rise to 10%. But there will not be any signs of the upcoming increment due to the upcoming General Election. By not revealing the tell-tale signs of an impending GST increment, the public will not go into a mad rush to purchase big-ticket items. As this will result in a sudden spike in the economy, making it difficult to use conventional algorithm to predict and analyze the market. Thus in preparation of preventing this spike, all big ticket items are raised to a new high in the year of 2010, so as to discourage sudden and excess spending and debt accumulation. This will ensures that when the GST is increased to 10%, the economy will not be shaken and there will be an almost seamless transition without much complains from the general public since most of the big ticket items are not affordable by the large portion of the population [ aka most middle class population ].
So if free monies can be given to the needy and this monies can be recovered by increasing tax collection without adverse impact to the economy and zero upheaval from its citizens and ensuring positive wealth accumulation as a nation. Why not?
And best of all, the budget will look nice and give positive ratings to the incumbent administration in time for the upcoming general election.
Read my previous entry on my thoughts on the ever increasing GST here
Last but not least, I'd like to requote my tweet.
"The right to vote MUST be exercised with great caution. Not many above the age of 21 know the responsibilities & consequences of their vote."
The above is my personal opinion. You have to arrive at your own conclusions.