Friday, February 09, 2007

"If I Were The Finance Minister"

Try out this simulation game, it's fun.

As always, I'd love to see the extreme & how it impacts the budget:
a) If expenditure all up (max +10%), financing all down (corporate income tax 15%, individual income tax 15%, GST 1%).

Budget Position = -$9,039m

b) If expenditure all up (max +10%), financing all up (corporate income tax 24%, individual income tax 24%, GST 10%).
Budget Position = $3,561m

c) If expenditure all down (max -10%), financing all down (corporate income tax 15%, individual income tax 15%, GST 1%).
Budget Position = -$3,441m

d) If expenditure all down (max -10%), financing all up (corporate income tax 24%, individual income tax 24%, GST 10%).
Budget Position = $9,159m


The 'expenditure' in the simulation game is categorized as follows:
1. Social
1.1 Enhancing our housing & living environment
1.2 Providing good & affordable healthcare
1.3 Helping families & providing social safety nets
1.4 Educating our next generation

2. Security & External Relations
2.1 Ensuring a safe & secure home

3. Economic
3.1 Building a competitive economy
3.2 Providing a good transport infrastructure

4. Government Administration
4.1 Building an efficient & responsive public sector

Whereas 'financing' (at least the variable components in the game) is grouped into:
5. Corporate Income Tax
6. Individual Income Tax
7. Goods & Services Tax (GST)

Now I'm interested to find out what if all components under 'Social' to be down max -10% (and people ask why I'm an antisocial. Heh), 'Security & External Relations' to stay unchanged, 'Economic Building a competitive economy' to be up max +10%, 'Economic Providing a good transport infrastructure' unchanged, 'Government Administration Building an efficient & responsive public sector' unchanged...

...and Corporate Income Tax to revise from the current 20% to 18%, Individual Income Tax from 20% to 18% & GST from 5% to 7%.
Budget Position = $1,237m

Hey, following the above scenario, I'm even tempted to further revise Individual Income Tax from 20% to 15% (Darn, that's the lowest the game allows. I am striving to be a good antisocial), it results to...
Budget Position = $592m

Good enough, I'll say.

2 comments:

Ole' Wolvie said...

Bleh, lower personal income tax don't really affect people like us.

We're not even in the 10% bracket.

Anonymous_X said...

So I made a wrong assumption that lowering the income tax from 20% to 15% would mean lowering it at all the levels / 'brackets'. :-\