Prime Minister Datuk Seri Najib Razak has successfully tabled the Malaysia Budget- 2017. The latest budget covers a wide area of economy and there are many forecasts and ideas that are on the wish list but haven’t materialized. The budget saw an increase from the 2016 budget allocation by 3.4%. Malaysia has been reducing the dependency on the crude oil sector due to declining global crude oil prices. The revenue from oil and gas has come down to only 14.6% in 2016. The shift in the revenue has been possible due to the implementation of GST. The GST will not be increased for 2017. Malaysians should not be expecting more subsidies next year as the subsidy allocation has been cut down from RM26.1 billion to RM10 billion.
Key highlights of Malaysia’s 2017 budget
Following are the key highlights from the 2017 budget:
- The fiscal deficit is 3%,
- The GDP is between 4% – 5%.
- The revenue is RM219.7 billion.
- The theme of the budget is to accelerate growth while ensuring fiscal prudence and enhancing the wellbeing of Rakyat.
- The total budget allocated is RM260.8 billion, out of which:
- RM103.9 billion is for fixed charges and grants
- RM77.4 billion is for emoluments
- RM32 billion is for supplies and services
- RM816.6 million is for others
- RM691 million is for purchase of assets
6. The total operating expenditure is RM214.8 billion, out of which:
- RM25.9 billion is for economic sector
- RM12.2 billion is for social sector
- RM5.3 billion is for security sector
- RM2.5 billion is for general administration
- RM2 billion is for contingencies
7. The development expenditure is RM46 billion and the guiding principles for the same are as follows:
- To prioritise clear direction for systematic planning, efficient, and structured implementation of plan.
- To preserve sovereignty, to uphold constitution and national security and law.
- To uphold moderation, social justice, fairness, balance, and excellence.
- To prioritise national integration and ethical diversity.
- To prioritise a stable government.
8.Housing has become affordable with:
- Perumahan Rakyat 1Malaysia: Vacant and at strategic locations will be allocated to build over 30,000 houses that will be sold between RM150,000 – RM300,000.
- Special step-up end financing scheme for PR1MA: Total loan of up to 90- 100%. Loan rejection rate will be reduced. This is effective from 1st January, 2017. Stamp duty exemption will increase to 100%.
- 5,000 units of PMR (People’s Friendly Home). RM200 million is allocated. Government subsidies offered is up to RM20,000 per unit.
- RM200 million has been allocated to build houses for B40 on their own land. RM20,000 will be paid for each unit, the remaining to be paid in instalments by the owner.
- More People’s Housing Programme houses: RM576 million is set aside or 11,250 PPR houses that are to be sold between RM35,000 and RM42,000. RM134 million has been set aside to build 9,850 PPR houses.
- Youths will get 10,000 houses in urban areas that will be rented out to them. This is for youths who have permanent jobs for up to 5 years and the rent will be below the market rate.
- Stamp duty on the instruments of transfer of property above RM1 million will increase from 3% to 4% which will be effective from 1st January, 2018.
- E-Kashik target for 2017 is RM1,200. Households earning between RM3,000 – RM4,000 allocation is RM900. Singles earning below RM2,000 will be allocated RM450. Bereavement scheme allocation is RM1,000.
- Personal income tax relief is as follows:
- Lifestyle tax relief up to RM2,500 per year.
- Breastfeeding tax relief up to RM1,000 once every two years.
- Early education tax relief up to RM1,000 per year.
- Private retirement scheme will be effective from 2017. RM165 million is allocated for the same. Minimum accumulated investment is RM1,000 during the period of 2 years.
- Fixed line broadband service will offer their facility at higher speed for the same price. The speed will double and the prices will be reduced by 50%.
- MySuria programme will benefit 1,600 households. Participants will receive RM250 per month.
- Mobilepreneur Programme by GIATMARA – RM30 million is allocated for 3,000 participants who use motorcycles.
- Agropreneur programme- RM100 million is allocated for 3,000 young entrepreneurs.
- eUsahawan and eRezeki programmes- RM100 million is allocated for 300,000 participants.
- Ride Sharing driver- RM4,000 rebate.
- Financial assistance to 69,000 poor families: Up to RM300 per month for general assistance. Up to RM450 per month for children assistance.
- RM60 million is set aside to provide RM5,000 grant to purchase new vehicles and individual taxi permits to benefit over 12,000 qualified taxi drivers.
- RM60 million is set aside to launch Social Security Organisation Scheme for taxi drivers who have monthly income up to RM3,000. The contribution will be between RM157 and RM443 per annum.
- Corporate Income Tax has been reduced. All SMEs tax rate on the chargeable income up to RM500,000 is reduced to 18% which will be effective from the AY2017.
- By EXIM bank to SMEs- Loan financing total RM200 million.
- SJPP- 2% rebate on interest charged to SME borrowers.
- Working Capital Guarantee Scheme fund- RM200 million allocated for start-ups.
- RM50 million for SMEs loans from KOJADI.
- RM20 million for microcredit loans under Malaysian Chinese Women Entrepreneurs Foundation.
- RM20 million for Malaysia Hawkers and Petty Traders Foundation.
- RM150 million for business financing programmes through TEKUN and AIM for Indian community.
- RM130 million provided through National Export Promotion Funds.
- RM286 million allocated to increase exports.
- RM75 million allocated for SME Master Plan.
- RM162 million allocated for e-Commerce ecosystem, Malaysia Digital Hub, and Digital Maker Movement.
- RM570 million allocated to reconstruct 120 destitute schools.
- RM478 million allocated to complete construction of 227 primary and secondary schools.
- RM10 million allocated for pre-school programmes for 50 national type Tamil school.
- RM600 million allocated for special fund for improving and maintaining schools.
Following has been allocated for Higher learning:
- RM7.4 billion for 20 public universities.
- RM300 million for 5 research universities.
- RM1.4 billion for 4 university hospitals.
- RM4.3 billion for scholarships.
- RM100 million to increase publications and intellectual properties.
- RM1.1 billion allocated for additional assistance payment for school fees, per capita grant assistance, and textbook assistance.
- RM85 million allocated for PERMATA programme that involves 50,000 children.
- RM90 million allocated for Cambridge English Dual language and highly immersive programmes.
- RM100 to be given for students from families earning RM3,000. 3.5 million students will be benefited.
- RM300 million for primary school students who are under Malaysia Supplementary Food Programme.
- RM1.1 billion for Hostel Meal Assistance Programme. 365,000 students will be benefited.
- RM132 million to improve access to preschool education in government schools for free.
- RM200 million for Additional Food Assistance. 280,000 children will be benefited.
- Book vouchers worth RM250 to be replaced with student debit card. 1.3 million students will be benefited.
- RM150 will be given every month for 67,000 students and replace buses for 21 special education schools.
Teachers and assistants:
- 430,000 teachers will get free tablets. RM340 million has been allocated for it.
- KEMAS assistants will get RM500 allowance and this will benefit 11,000 assistants.
- Matching grants of up to RM50 for the accumulated savings in SSPN-i for students in Year 1 in a fully assisted government school.
- Repayment for full settlement will get 15% discount.
- 50% settlement of the outstanding debt in the single payment will get 10% discount.
- Salary deduction or direct debit will get 10% discount.
- Once in 3 years maximum loan of RM5,000 will include the purchase of smartphone.
- Housing loan eligibility is from RM200,000 and RM750,000.
- Motorcycle loan limit has increased to RM10,000.
- Management and professional group will get fully paid study leave with scholarship.
- Up to 5 days quarantine leave without record will be provided to public servants whose children are sick and there is a need to be quarantined.
- RM500 financial assistance will be provided to all public servants.
- RM250 will be paid for government retirees.
- Payout will be in January, 2017.
- RM100 million allocated to increase opportunities to Bumiputera Entrepreneurs.
- RM200 million allocated to Perbadanan Usahawan Nasional Berhad.
- RM100 million allocated for various entrepreneurship programmes.
- RM100 million allocated for Export Fund for Bumiputera companies.
- RM500 million allocated to assist Bumiputera companies.
- RM 120 million allocated to MARA.
- RM300 million allocated to assist small- scale enterprises.
- RM29 million allocated to repair Overhead Motorcycle Ramps.
- RM55 billion allocated for East Coast Rail Line Project.
- RM100 million allocated to restore East Coast railway line.
- RM1.1 billion allocated to purchase 10 more new train sets.