These are just some suggestions for government to mitigate the effects of the economic crisis. We are seeing a slow spill-over of the effects of this crisis into the populace. And sincerely, we don't want riots to break out right now since disorganized violence tends to destroy rather than create societies. Here are some thoughts:
1. Government should momentarily suspend VAT collections until January 2009. Analysts say, the global slowdown will ease starting February 2009. Instead of collecting VAT and giving it to the poor as subsidies, suspend VAT altogether to prevent the further swelling of the ranks of the poor. Without VAT, that would allow the middle class to at least survive this crisis. This crisis affects the middle class more than the poor since they are the ones who consume more.
2. Government should implement the daylight saving time (DST) again to conserve energy and resources.
3. Implement a four-day work week for private companies and some government agencies. That would reduce costs and save government some money.
4. Increase excise taxes. Collections from excise could mitigate the effects of VAT collections.
5. Encourage businesses to give non-wage benefits instead of increasing wages to 10%. A wage increase right now will not ease the economic and financial pressures caused by the global slowdown. A 10% wage hike will put pressure on firms to pass up the extra wage hike to consumers, hence, higher prices of commodities.
6. Lower interest rates of banks to encourage more people to engage in small businesses or enterprises. This will keep the domestic economy alive.
7. Prevent or deter a localized sub-prime market crisis by allowing a loan interest holiday up to January 2009. That would allow people to keep more money, hence, they are more liquid. Pag-ibig or SSS should give debtors some leeway in their late payments. A condonation of debts could also work.
8. Encourage people to save more in banks. The more people putting their money in banks, the more it contributes to fiscal equilibrium.
You have conflicting statements. You desire to encourage people to save in banks and yet you propose tp lower interest rates. I suppose u know the dynamics that interest rates apply to depositors, right? A lower interest rate does not in any way encourage depositors to put their mony in the bank.
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