What is the big deal about government’s increase of VAT rate from 5% to 7.2%?

The Federal Government’s decision yesterday to increase the value added tax (VAT) rate from 5% to 7.2% is a polite way of saying to you “We the federal, state and local governments appreciate the money you pay to us every day through VAT, but we seriously need more from you to spend it for the usual things we spend it on. Will you help?”