Chart of the Day: This chart shows how high taxes rocketed in 2013

How will corporates be hurt?

According to CIMB, with the economy at full employment (unemployment rate at 1.8%), and businesses also having to deal with rising rental costs, Budget FY14 included more measures to help companies address Singapore’s productivity challenges. 

However, companies will also face added manpower costs from Jan 15 because of a 1%pt hike in the employers' CPF contribution rate for all workers.

Here's more from CIMB:

For households, the government plans to improve the social safety net as it prepares for an ageing society. And with the property market only starting to stabilise, the government said it is too early to relax current property measures.

From the perspective of corporate earnings and the impact on the stock market, our strategist, Kenneth Ng, views the main negative impact of Singapore’s Budget FY14 as higher manpower costs for companies.

On the positive side, the Finance Minister said that rising supply of industrial and shop space should be a moderating influence on property prices and rents ahead.

We think that the policies still set a negative undertone for developers with a larger Singapore inventory (City Developments), although the issue of housing inventory is well-known by now and it is difficult to see massive underperformance with all developers trading at deep discounts to their RNAVs.