Friday, October 23, 2009

Budget 2010 - 1Malaysia, Together We Prosper - Malaysiakini

Oct 23, 2009


Budget 2010's three-pronged strategy - driving the nation towards a high-income economy, ensuring holistic and sustainable development and focusing on the well-being of the people.

GDP for 2009 is expected to be -3%, better than the earlier estimation of -4% to -5%.

The total expenditure allocated is RM191.5 billion, which is 11.2 percent less that what was allocated last year (RM215.7 billion).

Of this, the proposed operating expenditure is RM138.3 billion and development expenditure is RM53.2 billion.

The government's income meanwhile has shrunk 8.4 percent to RM148.4 billion (RM162.1 billion in 2009).

The budget deficit is proposed to be reduced to 5.6 percent from 7.4 percent last year.

Salient points of Najib's speech:


* Malaysia economy to grow 2-3 percent in 2010

* Mining to grow 1.1 percent, manufacturing sector 1.7 percent, agriculture 2.5 percent, construction 3.2 percent and service 3.6 percent.

* Private consumption expand 2.9 percent while private investment 3.4 percent.

* Per capita income to increase by 2.5 percent to RM24,661.

* TNB to spend RM5 billion to implement electricity generation, transmission and distribution projects in 2010.

* Public-private collaborations to include an integrated immigration, customs and quarantine complex in Bukit Kayu Hitam, construction of six UiTM campuses and the development of Matrade centre.

* 1Malaysia Development Bhd (1MDB) will establish a corporate social responsibility fund totalling RM100 million as a start to finance community activities.

* Government to allocate RM899 million to intensify tourism industry.

* Government to enhance tax incentives for healthcare service providers who offer services to foreign health tourists with income tax exemptions of 100 percent on the value of increased exports from 50 percent previously.

* Individual taxpayers to be given tax relief on broadband subscription fee up to RM500 a year from 2010 to 2012.

* Civil servants are eligible to apply for computer loans once in every three years and up to a maximum of RM5,000 from the government once in every five years.

* Formulate Halal Act in collaboration with State Islamic Religious Councils.

* To corporatise the Halal Industry Development Corporation as an agency under Ministry of International Trade and Industry.

* Intensify halal certification by the Islamic Development Department of Malaysia (Jakim) by collaborating with international institutions to obtain standards certification such as HACCP and GMP.

* To provide RM24 million to develop halal products anti-smuggling system at three entry points and three main ports.

* Allocate RM137 million to upgrade and improve drainage and irrigation infrastructures in paddy fields involving 180,000 farmers.

* To provide RM70 million to build the Paya Peda Dam Project in Terengganu to increase water supply capacity to paddy irrigation scheme in Besut.

* Allocate RM82 million to modernise aquaculture industry and conduct entrepreneurship training scheme for aquaculture breeders with focus on production of fish fry and ornamental fish.

* RM149 million allocation to develop food farming industry such as fruits, vegetables, organic farming, herbs, seaweeds and swiftlet nests.

* RM58 million to develop basic infrastructures for livestock farms and establish supply chains for beef and mutton production.

* A consortium comprising Felda, Felcra and Risda will be established by the end of 2009, with a paid-up capital of RM300 million and with each agency contributing RM100 million.

* Government to provide subsidies, incentives and assistance amounting to some RM2 billion to farmers and fishermen to safeguard their interests.

* Government to allocate RM9 billion to finance infrastructure projects, with RM4.7 billion for road and bridge projects, RM2.6 billion for water supply and sewerage services, RM899 million for rail facilities, RM820 million for ports and sea services and RM276 milliion for airport projects.

* To consolidate 79 SME funds to 33 to simplify access to SME financing to be coordinated by SME Corp.

* To allocate RM350 million to SME Corp, with RM200 million set aside for SME soft loans, RM100 million for capacity enhancement and the balance for branding and promotion.

* Financial institutions to approve micro-financing in six days and disbursement in four days.

* To allocate RM538 million for implementation of various SME programmes, with RM281 million to state economic development corporations, RM200 million to Tekun and RM57 million for purchase of business premises and infrastructures.

* Government to sanction RM20 million to intensify green awareness activities and practise environment-friendly lifestyle.

* Develop Putrajaya and Cyberjaya as pioneer townships in GreenTechnology as a showcase for the development of other townships.

* Establish a RM1.5 billion fund to promote green technology, with a maximum RM50 million financing for suppliers and RM10 million for consumer companies.

* Applications for financing through the National Green Technology Centre to commence on Jan 1, 2010 and 140 companies are to benefit.

* Building owners obtaining GBI Certificates from tomorrow until Dec 31, 2014 are to be given income tax exemption equivalent to additional capital expenditure.

* Stamp duty exemption to buyers of buildings with GBI Certificates from tomorrow till Dec 31, 2014.

* Simplify permanent residency (PR) applications for those who possess high talents, expatriates will be issued visas within 14 days while male expatriates who marry locals will be automatically conferred PR status.

* Government will ensure that the five regional corridors - launched during former premier Abdullah Ahmad Badawi's tenure - will be developed according to schedule.

* To ensure fuel subsidies only benefit targeted groups, the government will implement a fuel subsidiy management system in early 2010. This is a more people-friendly system utilising MyKad and the existing infrastructure.

* There will be no more free credit cards which are currently being used extensively. The number increased from more than two million in 1997 to 11 million as of August 2009, excluding 285,000 charge cards. To promote prudent spending a service tax of RM50 a year will be imposed on each principal credit card and charge card, including those issued free of charge.

* There will also be service tax of RM25 a year imposed on each supplementary card.

* RM3.7 billion set aside to beef up the security forces, including providing modern and sophisticated equipment for the relevant agencies.

* Target set to reduce crime index by five percent, including street crimes such as snatch theft and robberies by 20 percent by the end of 2010. Among the measures that will be taken is to increase police presence by providing stations in 50 crime hotspots.

* Open Approved Permit (AP) holders to be charged RM10,000 for each AP given. The new ruling will come into effect on Jan 1 next year.

* Government committee to achieve target of zero hardcore poverty in 2010. Five thousand poor households registered with eKasih and 4,000 Orang Asli households to receive aid. Skills training programmes and income generating programmes will be provided. Federal welfare assistance to be distributed on the 1st of each month.

* RM141 million to be allocated for 'Program Lonjakan Mega' scheme to alleviate 5,600 families from hardcore poverty.

* Double deduction on expenditure incurred in promoting Malaysia as an international financial centre.

* Deduction on expenditure incurred to set up islamic stockbroking companies.

* Deduction on expenditure incurred on the issuance of Islamic securities.

* Government to encourage all syariah-compliant financial and banking institutions such as Bank Muamalat and Bank Islam to offer Ar-Rahnu scheme.

* Government to ensure regional corridors be developed according to schedule.

Todate 126 of 195 planned projects are at various stages of implementation. Planned investments totalling RM221 billion have exceeded the 9MP target of RM145 billion.

* Government to allocate RM3.5 billion for infrastructure and basic amenities and training programmes and socio-economic projects to support implementation of private sector projects.

* Government is in the final stage of completing a study on imposing Goods and Services Tax (GST). The rate will be lower than the current sales and service tax.

* Income tax for 2010 based on income derived from 2009 will be allowed to be paid in instalments in five years.

* A five per cent tax to be imposed on gains from disposal of real property from Jan 1, 2010.

* A RM50 service tax to be imposed on each principal credit card and charge card and RM25 a year on each supplementary card from Jan 1, 2010.

* RM100,000 to be imposed for each AP to open AP holders effective Jan 1, 2010.

A portion of the collection will be channelled to the Bumiputera development fund in the automotive sector.

* To introduce a basic insurance and takaful scheme for motor insurance protection by mid-2010.

* To expand micro insurance and takaful coverage for small-scale businessmen to benefit from coverage ranging from RM10,000 to RM20,000 with a premium as low as RM20 per month.

* Stock market to be further liberalised to enhance efficiency.

* Liberalise commission-sharing arrangements between stockbrokers and remisiers by allowing flexible brokerage sharing at a minimum rate of 40 per cent for remisiers and to have commission-sharing fully liberalised effective January 1, 2011.

* Allowing 100 per cent foreign equity participation in corporate finance and financial planning companies.

* All public-listed companies to offer e-Dividend and stockbroking companies to provide e-Payment options.

* Current tax incentives to develop financial services, particularly Islamic finance, extended to 2015.

* Twenty per cent stamp duty exemption on Islamic financing instruments.

* Tax exemption on banking profits derived from overseas operations.

* Effective Jan 1 2010, government agrees to allow agencies to retain 50 per cent of rentals received while the remaining 50 per cent will be remitted to the government as revenue.

* The Government will implement fuel subsidy management system in early 2010.

* The Government proposes the maximum income tax rate to be further reduced to 26 per cent from 27 per cent effective from the 2010 year of assessment.

* Maximum tax rate for cooperatives will be reduced to 26 per cent while the fixed tax rate for non-resident individuals will be cut to 26 per cent.

* Personal tax relief will be increased to RM9,000 from RM8,000 effective from the 2010 year of assessment.

* The Government also proposes income tax on employment income of Malaysians and foreign knowledge workers residing and working in Iskandar Malaysia be imposed at 15 per cent compared with the maximum 26 per cent for the rest of the country.

* Government to launch a scheme in January 2010 that enables EPFcontributors to utilise current and future savings in Account 2 to promote house ownership.

* RM14.8 billion is allocated to manage, build and upgrade hospitals and clinics.

* The Government will issue 1Malaysia Sukuk totalling RM3 billion.

* The Government will establish the 1Malaysia Retirement Scheme to be administrated by EPF.

1 comment:

Horlic said...

haha, now whole malaysia's credit card holders are f'ing on the RM50 credit card service tax. WTH policy is it!