Retailers are making more money this year.

Those interviewed by the Business Times say that sales have climbed by between 5% and 20% during this year’s festive season.

They attribute this to an improving job market, higher bonuses and record tourist arrivals.

People are also spending more on big-ticket items like jewellery.

So things are going swell for them right now.

And judging from how my girl friends are tearing through the shopping malls post-Christmas, I’d say going to stay like this all the way till the Chinese New Year.

But with the increase in Goods and Services Tax (GST) looming ahead, things are certainly going to change.

The proposed 2% hike will impact on how consumers spend, especially when major wage increases will not be rising in tandem with this.

If we don’t leisure-shop that much, it would also mean we wouldn’t eat and drink out that much, so good luck to the restaurants and eateries on that front.

Singaporeans aside, tourists from neighbouring countries would also find it less attractive to shop here.

They could easily fly to somewhere like Hong Kong for their next shopping holiday.

After all, Hong Kong has no GST, has recently dropped a plan for a similar tax, and is marketing itself as a shopping destination.

According to the BT, FJ Benjamin CEO Nash Benjamin said “and a 2% hike will, I feel, temper the business”.

Considering how affordable budget carriers are making travel to places like Hong Kong to be, even Singaporeans wouldn’t have any qualms taking short weekend trips there.

So retailers and eateries had better enjoy it while it lasts.

Because once the hike steps in, Orchard Road may look a quieter stretch.

Serene Lim