Budget 2006 set for economic growth

budget-2008-photo.jpg

Prime Minister and Finance Minister Dato’ Seri Abdullah Ahmad Badawi presented his fourth budget yesterday, at Dewan Rakyat. Dressed in a blue traditional full Baju Melayu suit, this is where the budget will go to for next year

(taken from The Star):

 



Allocation up 2.5 %

A total of RM168.8bil has been allocated under Budget 2008 – an increase of 2.5% over 2007.

Of the total, RM128.8bil is for operating expenditure and the balance RM40bil for development expenditure.

Operating expenditure is projected to increase 4% next year over 2007, mainly for charged and locked-in items.

Emolument will receive the biggest allocation amounting to RM36.2bil to further improve the public sector delivery system as well as to enhance the efficiency and productivity of Government employees.

Other major allocations provided included grants, transfers and subsidy payments amounting to RM63.9bil as well as supply and services at RM25.5bil. Subsidy payments are mainly for petroleum products and diesel.

Under the programme to develop sectors with high growth potential, RM6.5bil has been allocated for agriculture.

Some of the programmes identified include livestock farming, aquaculture as well as financing schemes for farmers and those involved in commercial agriculture.

In addition, RM40mil has been allocated for the development and promotion of halal hub and halal park particularly in selected states in Malaysia.

Tourism has been recognised as one of the major sources of foreign exchange earnings. The Tourism Ministry has been given an allocation amounting to RM858mil. Programmes receiving attention under tourism include promotion of tourism domestically and abroad, development of eco-tourism products, provision of tourism infrastructure, and promotion of MalaysiaKitchen Programme – an effort to promote Malaysian cuisine overseas.

Infrastructure development would continue to be given emphasis with RM6.5bil allocated for construction and maintenance of roads, bridges and rail.

Similarly, airports and ports have been allocated RM1.3bil and water supply and sewerage RM2.82bil.

To inculcate a maintenance culture, RM9.18bil has been allocated to all ministries and agencies for maintenance of government assets to ensure minimal disruption, more economical life span and to provide better service to the public.

The Budget will continue to emphasise on formal education at all levels with RM767mil allocated for pre-school education especially for the establishment, refurbishment and operation of kindergartens in rural areas.

Primary and secondary education received substantial allocation for development expenditure amounting to RM3.51bil for 668 and 262 primary and secondary school projects respectively.

In addition, an allocation of RM303mil has also been provided to upgrade computer literacy and IT education benefiting 1,000 schools. For tertiary education, RM6.8bil has been provided for the operation of 21 public institutions of higher learning (IPTAs) catering for 412,700 students. To further expand the capacity of IPTAs, an allocation amounting to RM2.5bil has been provided for development projects.

Community colleges and politechnics were given RM1.21bil to increase the number of trainees with technical and trade skills. As in the past, MARA was given substantial allocation amounting to RM340mil for its skills training institute, which included the construction of four new ones.

The national service training programme was allocated RM677mil, which would benefit 110,000 trainees in 84 camps nationwide in 2008.

Under the 2008 Budget, the Government has also allocated RM1.44bil to construct and upgrade hospitals, health clinics as well as quarters for medical personnel.

In addition, RM401mil has been allocated for operation of newly completed facilities, maintenance of information and communication technology systems, implementation of Harm Reduction Programme and financial assistance for lower income groups seeking medical treatment, particularly chronic diseases.

To eliminate hardcore poverty by 2010, the Government has allocated RM794mil for poverty alleviation programmes including Kumpulan Wang Amanah Pelajar Miskin as well as food and nutrition for school and kindergarten students.

Some RM264mil has also been allocated for special programmes to assist the poor and hardcore poor families under Skim Pembangunan Kesejahteraan Rakyat and Amanah Ikthiar Malaysia. Those who are disabled, handicapped, elderly and single mothers are provided special assistance in the form of welfare payments, priority for low cost housing and preference for shelter in welfare homes.

As Malaysia moves towards developed country status, the Government has allocated RM1.71bil for youth and sports development as well as appreciation of arts and culture, which have been gaining prominence.

The Government has allocated RM23.3bil for operating and development expenditure to strengthen the police and armed forces.

Efforts will be made to improve tax administration and enforcement to boost revenue collection and minimise tax evasion and leakages.

 

This where the money will come from:

 

 

Revenue to increase by 14.8%

REVENUE is expected to increase by 14.8% to RM141,790mil in 2007, making it 27% of the GDP.

In comparison to last year’s revenue of RM123,546mil this is an increase of 16.2% in revenue or 21.6% of the GDP.

The expected increase in revenue comes from a higher collection of taxes and non-tax revenue. This is to be spurred by better economic performance; high oil prices, an improved tax administration and enforcement efforts.

If tax revenue meets the expected 11% increase to RM96,196mil, it will make up 67.8% of total revenue.

Of this, direct taxes contribute RM70,116mil while indirect taxes contribute RM26,080mil.

The main components of direct tax revenue are corporate tax (RM30,821mil), petroleum income tax (RM22,600mil) and individual income tax (RM12,154mil).

The Government is also expected to collect a substantial amount of revenue from stamp duties (RM3,037mil), real property gains tax (RM150mil) and co-operative income tax (RM139mil).

Indirect taxes are mainly from excise duties (RM8,500mil), sales tax (RM7,144mil) and service tax (RM3,300mil).

Other sources are import duties (RM2,300mil) and export duties (RM2,500mil). Import duties come mainly from motor vehicles while export duties are taxed from petroleum and petroleum-related products.

The collection of indirect taxes is expected to remain at the 2006 level primarily, due to the liberalisation of import duties in consistent with Malaysia’s commitment to regional and bilateral trade agreements.

In 2007, non-tax revenue is estimated at RM45,594mil, an increase of 23.5% over 2006, and contributing 32.2% of total revenue.

The main sources of non-tax revenue are dividend income (RM24,000mil), which is mainly derived from Petronas, as well as licenses and permits (RM9,256mil).

Other sources of non-tax revenue include proceeds from the securitisation of Government employees’ housing loans (RM5,000mil) and dividend income from Khazanah Nasional Bhd (RM1,000mil).

In the 2007 budget, several tax measures were introduced to reduce the cost of doing business, to enhance competitiveness and spur economic activities.

The measures included the progressive reduction of corporate tax rate from 28% in 2006 to 27% this year and to 26% in 2008.

To promote a healthy lifestyle and to discourage smoking, further increases in duties for cigarettes and tobacco products were imposed.

Published in: on September 8, 2007 at 11:33  Comments (2)  

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2 CommentsLeave a comment

  1. ..budget umum hari jumaat…sepet pakat naik harga..bahan mentah..kaw-kaw bro…hari sabtu..telur sepapan 30 biji gred c biasa 5.90 naik 6.90…1 ringgit..bawang sepeket 10.00 ni dah mahal dah..naik 14.00rm…peehhhh….terkedu la peniaga-peniaga kedai mkn melayu jeeemmm nak naik harga mkn…org marah..mahal…cerita pertanian..bahan mentah tu bukan dari pertanian…susah lo…developer untung..mostly sepet..kuli melayu…tanahair ku…untung sepet lagi

  2. […] ialah apabila Malaysia diperlihatkan bagaimana Menteri Kewangan membentangkan Bajet 2008 diDewan Rakyat yang tidak konsisten dan apabila ditanya pemberita, secara selamba meminta perkara itu dirujuk kepada Menteri Kewangan […]


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