ThroughTheLens

Review on Malaysia Budget 2008 September 7, 2007

Filed under: Miscellanuous — saifulrizan @ 1:36 am

Pak Lah tabled the Budget 2008, themed “Together Building The Nation and Sharing Prosperity”, in Parliament today, 7th September 2008. I never fell for this kind of thing, since I have no doubt on whatever areas the government will spend the tax payer money. Besides, I guess KLCC was made with a portion of my income declared for annual tax. But this time, few matters with regards to the Budget 2008 caught my attention, despite there’s still a bitter of ignorance floating inside my typical Tak Apa mind.

As what I’ve read yesterday, Thursday, there’s few significance point that will be implemented in the practice of Budget 2008. And today, I am still reading the long speech delivered in the Parliament today, presenting each components and plans consisted in the Budget 2008. First few glances confirmed what I’ve read today (at least, it was delivered in national TV. Nevermind the implementation then, times will tell).

So, this was what I read yesterday morning, tabulated the main essence of Malaysia Budget 2008

The broad framework of the Budget essentially covers three areas:

  1. Improving the quality of life;
  2. To make common consumer items affordable and not a burden to the lower-income group; and
  3. Beefing up the police force to fight crime, a major concern of Malaysians.
I wouldn’t want to touch on the third point, given that there was a major hauling over Government reaction towards bloggers, with both parties trying their best defend their side disregard the sanity and rationality of actions taken by both side (disregard the volume of action taken). Besides, I wont risk my future just for voicing out about my opinion related to things that still to shallow (for me the least) and by my fair bit judgments towards Pak Lah promise to Malaysian citizen when he first lifted as PM, to fight corruption in Malaysia. Well said.

However, the Budget 2008 today presented with the implementation on three (3) strategies, that is:

First – Enhancing the nation’s competitiveness;
Second – Strengthening human capital development; and
Third – Ensuring the well-being of all Malaysians.

With few matters arose with regards to the first strategy; Enhancing the nation’s competitiveness, proposals submitted to the Dewan Rakyat includes

  1. Providing a Conducive Environment for Private Investment (Private investment continues to be the catalyst of the nation’s economic growth)
  2. Competitive Tax Regime (Implementation of single-tier tax system – rofits are only taxed at the company’s level and dividends received are exempted from tax. dividends can be more easily distributed. )
  3. Simplifying Issuance of Work Permit and Visa for Skilled Workers (I hope the implementation only imposed to Skilled and Professional workers only – not those PTIs and GROs)
  4. Enhancing Competitiveness of the Capital Market
  5. Strengthening Corporate Governance (This will see an implementation of Corporate Governance in PLCs, as it will effect the period of approving corporate proposals, licensing, etc.)
  6. Encouraging Mergers & Acquisitions (the Government has given stamp duty exemption on instruments related to mergers and acquisitions (M&As) of PLCs, approved by SC up to 31 December 2007. To encourage more PLCs to undertake M&A, the stamp duty exemption will be extended to 31 December 2010. )
  7. Competitive Commission Structures (To encourage greater direct retail participation in share investment and trading as well as the greater use of technology in the capital market, the commission rates for internet trading and cash upfront transactions will be fully negotiable)
  8. Positioning Malaysia as International Islamic Financial Centre
  9. Promoting Investments from the Middle East
  10. Takaful Industry (the Government proposes several enhancements in the tax treatment, including tax deduction on the share of distributed profits. )
  11. Increasing the Competitiveness of Labuan as an Offshore Financial Services Centre (the Government proposes that Labuan offshore companies be given the option to be taxed under the Income Tax Act 1967, in addition to the existing options. )
  12. Stimulating Property Sector
  13. Agricultural Sector (The main thrust of agriculture sector development is to enable this sector to become one of the major sources of economic growth. For this purpose, a sum of RM6.5 billion is allocated for the agriculture sector.)
  14. Biotechnology Sector (the Government will continue to provide infrastructure and technological facilities. For this purpose, a sum of RM236 million is provided in the 2008 Budget)
  15. Tourism Sector ( RM858 million is allocated for the implementation of various programmes, including the provision and upgrading of tourism facilities as well as diversification of tourism products. An allocation of RM22 million is provided to increase homestay activities in 47 selected villages.)
  16. Promoting Small and Medium Enterprises (SMEs) (Recognising that SMEs may face cash flow constraints at the initial stages of operations, the Government proposes giving them flexibility to pay taxes at the end of financial year instead of monthly instalments. This flexibility is for a period of 2 years from the date of commencement of operations. )

With few matters arose with regards to the second strategy; Strengthening human capital development, proposals submitted to the Dewan Rakyat includes

  1. Strengthening Primary and Secondary Schools (RM 30 billion to make school looks interesting – and teachers are cool.)
  2. Free Education For All (Last year, examination fees for PMR, SPM & STPM abolished. 2008 will witnessed the same goes to Sijil Tinggi Agama Malaysia, primary and secondary school – smile to all parents out there!)(Text Book Loan Scheme will be provide to all students, irrespective of their parents income)
  3. Important Role of Teachers (Allowance to be increased to Special Education teachers, degree & diploma holders teaching Chinese and Tamil language in national schools)
  4. The Role of Charity Organisations in Education (Schools that are funded and well managed by trust and charitable bodies will be tax exempted)
  5. Strengthening Higher Education (aims to transform the higher education sector to produce highly knowledgeable and first class human capital as well as develop world-class higher education institutions.
  6. Increasing Scholarships Rates (Govt will increase between 23% to 84% for students in local higher learning institutions)(Overseas students will get an increment to support their Cost Of Living Allowance up to 97% effective September 2007)
  7. Enhancing Skills Training ( Polytechnic, community colleges, GiatMARA and ILP will benefit from this)
  8. Life Long-Learning (the Government proposes tax relief of up to RM5,000 on education fees be extended to all post graduate studies. )
  9. Research, Development and Commercialization
  10. Human Capital Development in ICT
  11. Nurturing A Knowledge-based Society (the Government has targeted to increase the broadband penetration rate to 50% of households by 2010, from 12% currently.)

With few matters arose with regards to the third strategy; Ensuring the well-being of all Malaysians, proposals submitted to the Dewan Rakyat includes

  1. Adequate Affordable Housing (1. this particularly targeted at low income group, with a sum of approximately RM 381 million will be spend on Program Perumahan Rakyat (PPR) Disewa and PPR Bersepadu. 2. The government will provide loans to a group that cant prove their income of stream specifically those from low income group, amounted to RM 50 million allocated to provide such guarantees to Bank Simpanan Nasional and Bank Islam Berhad, effective 1st January 2008 3. Those with EPF, you can withdraw your account balance in Account 2 for financing the repayment of your house loan.)
  2. Efficient Transportation System (this goes to improving the public transportation system at Kuala Lumpur and Penang. In Penang alone, the Penang Outer Ring Road will be implemented on tender basis shortly)
  3. Balanced Regional Development ( RM 4 billions will be allocated for Sabah, in areas such as the main road construction connecting major districts in Sabah, upgrading/building rural health and hospital facilities, low cost housing, electricity and water supply, as well as upgrading roads and railway) ( RM 4 billions will be allocated for Sarawak as well, mostly in development projects which related to public facilities) (RM 200 million to promote tourism activities in Sabah and Sarawak)(More efforts will be taken to help boosting local native in Sabah to upgrade their quality of life in all aspects)
  4. Eradicating Hardcore Poverty (A mere total of RM 330 million will be spend on the development programs to generate income for the population in less developed and remote areas, as well as providing housing to ease the hardcore poor status)
  5. Urban Poverty (Emphasis will be given on construction of adequate low-cost houses, provision of job opportunities and improving the public transport facilities)
  6. Rural Development (in order to reduce the gap among the rural and urban areas, more facilities upgrades will be focused on basic facilities and an addition of ICT education in rural areas)
  7. Improving the Quality of Life of Orang Asli (a total of RM 220 millions will be allocated to providing housing assistance, social ammenities and programmes and projects to upgrade the Orang Asli quality of life)
  8. Youth and Sports (surprisingly, they will add in RM677 million for National Service Training Program – after a heated debate on the credibility of NS responsibilities on the 14 deaths recorded in NS history)
  9. Women, Family and Community
  10. Well-being of Senior Citizens (Their monthly allowance will be increased to RM 300 per month, effective 1 January 2008) (RM 25 million granted to NGOs to expand existing capacity – because many Malaysians throw their mom and dad to Rumah Seri Kenangan la)
  11. Assistance For The Disabled (Monthly allowance will be increased to RM 300)(Allow tax deduction on renovation costs in the work place incurred by employers for the disabled to encourage the private sector to hire more disabled workers. )
  12. Provision of Health Services (RM 13 billion to improve quality of hospital services, building of nursing colleges and hospitals)
  13. Inculcating Corporate Social Responsibility (Public Listed Companies will be implemented to practice good Corporate Social Responsibility)(Beginning financial year 2008, PLCs will be required to disclose their employment composition by race and gender, as well as programmes undertaken to develop domestic and Bumiputera vendors. – Personally, why would there a report on race composition in CSR report? What’s the rational behind this anyway? )
  14. Public Safety (A sum of RM6 billion is allocated to the Royal Malaysian Police (PDRM) in 2008.)
  15. Nurturing Maintenance Culture
  16. Restructuring the Water Supply Industry
  17. Conservation and Preservation of Environment (If this implemented at the level of 100%, you wont see Mr Karam Singh Walia reporting on pollution anymore *wink)
  18. Enriching Culture, Arts and Heritage (A sum of RM 733 million to fund the awareness of culture, art and heritage in Malaysia, with the lots going to National Library, FINAS and the National Textile Museum)
  19. Important Role of Civil Service (Salary increase to civil servants- as announced before)

It is important for you to know that this blog only provides a short insight of the Budget 2008, just to give an idea on what the Government will spend for 2008 (and the year to come). This blogger is not responsible for any mistakes spotted in the representation of Budget 2008 in this blog. Please go to Full text of PM’s Budget 2008 speech to read the full disclosure of Budget 2008.

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4 Responses to “Review on Malaysia Budget 2008”

  1. cindy Says:

    At least we get free textbooks once again.. 😛

  2. SR215 Says:

    Yes, but I wonder what will happen to the text book stock in book shop?

  3. Anonymous Says:

    School text books are returned to the publishers a few months after school reopened each year. I found this out when I tried to purchase a replacement for the BM text book that my daughter misplaced middle of this year. I ended up having to photocopy it as I can not get a legal copy anywhere in Labuan.

    Francis

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