This part 3 supposed to be published less 24 hours then part 2, but I hold it because I want to see the outcome of “#TanyaNajib” which was live and recorded last night. I want to see the questions and answers along with reactions and comments. However, since then I was bogged down with tasks at hand, in which disabled me from completing Part 3 much earlier. For that, I am sorry for those who may be waiting for Part 3.
My analysis of BN’s budget based on his speech text published, document prepared by MOF and some insights from a commentary book by Chartered Tax Institute, Malaysia Institute of Accountants and CPA Malaysia. However, I won’t go deep as I believe many have read it in bit and pieces of what have been offered in the Budget. Still, I welcome anyone to drop any comment and having discussions on specific matters.
Now let us go through BN’s budget, in which the current budget for the nation, technically the only budget should be debated in the parliament (not the PR’s one).
The Budget is prepared with 5 main focus:
- Boosting investment activity
- Strengthening education and training
- Inculcating innovation, increasing productivity
- Fiscal consolidation and enhancing the public service delivery; and
- Enhancing the well-being of the Rakyat
These 5 basically looks like comprehensive and trying to cover all Malaysians as much as possible. However, as human being, I am pretty much convinced that despite best effort, some may not benefit from this budget… at least for being lazy and waiting to be fed.
Boosting investment activity may not be easy for a country that having quite uncertain political and social condition. Yes, I am referring to the eagerness of some who “love” to highlight the bad side of Malaysia and due to some bad habit of Malaysians too (in certain extend, I am referring to our certain taxi drivers, but I believe not all are bad). Certainly these made things not easy for investments to come in.
So, in order to get things moving, the part of the budget proposed to focus more on domestic investments, giving SMEs more space, opportunities and chances to grow. It also looks like the budget supports whatever ongoing programmes that have been initiated and planned earlier. I am having high hope that the SMEs really, really benefited from the programmes planned and initiated. It is because, I have the chance to meet and having discussions with some of the SMEs entrepreneurs and I do hope they can capitalized from such initiatives. At the very least, there is still room for them, protected from tough competition from big players.
However, as much high hopes I have, I am quite uncertain on us as Malaysians to consume local products. This is another angle that I can understand due to poor or low quality products provided by local market. Thus this perception and pattern can lead some of us not really care to spend more to buy better products. However, I also do not deny pretty high expectation and taste from some of us. So, to make this work, for SMEs to bloom, the SMEs really need to buck up, prove their mettle that the products they produced are as good as good as the imported ones.
In terms of tax, these measures are look to boost investment activities:-
- 100% Investment Tax Allowance for a period of 10 years for investment in refinery activities pertaining to petroleum related products;
- Reintroduction of 100% tax exemption for tour operators with an increase threshold of 750 inbounds tourists and/or 1,500 local tourists per year;
- Exemptions of RPGT and stamp duty on transfer of assets to a Business Trust;
- Double deduction on expenses incurred for issuance of Agro-Sukuk, retail Sukuk and retail bonds;
- Stamp duty exemption on instruments relating to transactions of retail bonds and retail sukuk.
Somehow, I do think 2nd Focus is inter-related with the 1st Focus on the training and development. With a good effective and efficient training, such good productivity can be achieved. As for the education plan for the juniors, I am hoping that the focus is not too much on just academic. We do not need imbalanced young generation of Malaysians of just excelling in academic, but failed in other aspects of life.
There concerns for me for this 2nd Focus are the work life balance of Malaysians and how Malaysians benefited from such training. From my observation, what I can see some Malaysians can’t get the best out of the training they attended. Many of the trainings are attended because it is allocated and budgeted, but as far as how much benefited the staff and improve productivity, I am very unsure how many of us capitalized on that, be it government or private sector.
However, the good side of attending training is chances to move up (but since not really appreciating the training, more time to spend on the work and not using the knowledge obtained from training to make tasks at hand easier, more effective and efficient).
Again, the budget do encourage such, but how many of us really benefited from such is a question for each of us (more than the government).
- Double deduction allowed on expenditure incurred for the provision and maintenance of child care centers and childcare allowance given to employees;
- 5 year income tax exemption on all income for operators of new and existing private childcare centers and preschools;
- Industrial building allowance at an annual rate of 10% for buildings used as childcare centers and preschools
With some elements of 1st and 2nd Focus, 3rd Focus can be carried out in more effective and efficient manner. With good human capital, any research and development on Intellectual Property, investment, innovation can be done in best manner. Innovation achieved, productivity increased… a picture that hoped to be painted in near future.
So, if we have good human capital, the present Green Technology Financing Scheme and proposed Intellectual Property Financing Fund can be benefited many in best manner.
As usual, a chance for misuse of funds is “available”, especially in R&D. A very good control from involved companies or whoever may benefit from such is hoped and welcomed.
For this focus, I’m not going to dwell much on the figures and predictions for the economy, since the predictions is made from study made. As I also didn’t make deep search on PR’s economic indicator, I won’t dwell much on BN’s. I’m assured that the study they made is in best possible manner.
However, my concern is on enhancing the public service delivery. This is an important and huge area. Enhancing public service delivery, which widely pictured for years as slow, ineffective and inefficient, is an area any government, be it BN, PR or any new coalition have to face and try to improve day by day.
It is much harder when we have intolerant Malaysians, and insensitive government staff. The problem with certain Malaysians is, for the amount they paid, they expect they will be served well, even they paid for RM1. Another type of problem is government staff doing their work at their own pace, without really aware (or ignorant?) of how long queue is. This kind of situations does not help much any government when campaigning for better government service. Trust me, under any coalition, BN or PR, this is the hard part where I am looking forward for continuous improvement, not just by the government, but by the staff and the service. (Latest update: It seems government received cold feedback on how to improve public service delivery… so, how we can help to improve this?)
Safety seems to be some of the main attention, considering voices of concerns from Malaysians before. Frankly, in my point of view, despite gone thru bad experience personally, I don’t think safety in Malaysia is too critical or too scary. During weekends I can still see shopping complexes crowded by people. I think we can still see people going out from their home and do outdoor activities.
Yes, there are some arguing that Malaysia is not that safe because of what crime reported daily in the news. This is where I hardly understand some of us being Malaysians. IF not reported, some of us will shout PDRM and the media are hiding something. However, when reported, some others will shout out that Malaysia is not safe because of what has been reported in the news.
So, which one do you want? Reported or not? If reported, by how many reports? Or do you want a system where a news flash will popped out every time a police report being made?
However, I applaud on the measures taken to ensure safety of Malaysians. Despite some being called “government’s dog” when not in agreement, they will still do their best in taking care of our safety.
Again, I would like to apologise for not being able to publish Part 3 earlier.
Before I end this article, there was a paragraph in the 2013 Budget Commentary made by CTIM, MIA and CPA Malaysia that caught my interest. The report commented:
… It also projects a positive outlook for the economy in 2013, with an estimated GDP growth of between 4.5% to 5.5% potentially resulting in the GDP surpassing the RM1 trillion mark for the first time in the nation’s history…
RM1 trillion mark for the first time… a figure that is huge.. and in order to achieve big numbers, a number of investment or cost need to be incurred.
Question on the street: IF you are a PM and also acting as Finance Minister.. will you give whatever your people want, without properly plan and having analysis done on risk and opportunities?