GOVT MUST EASE COST OF LIVING
THE prime minister, who is also finance minister, will be unveiling Budget 2018 in Parliament on Oct 27.
Everyone, especially those from the lower and middle income group, is anxiously waiting to see what type of allocations will be made and if these measures would help ease the cost of living.
It is without doubt that the introduction of Goods and Services Tax (GST) back in April 2015, coupled with subsidy rationalisation efforts and the weakening of our ringgit has adversely contributed towards spiralling cost of living, impact of which is being felt by consumers today.
Inflation figures rose to 4.1 per cent in the first half of this year and it might rise further should the ringgit value continue to decline while food prices rose to 4.2 per cent for the 12-month period ending July this year.
Although operating under pressure from a negative global economic outlook, the good news is that overall economic indicators have continued to show positive results.
According to Bank Negara Malaysia, our Gross Domestic Product (GDP) grew 5.8 per cent in the second quarter of this year from a year earlier while the firsthalf GDP expanded 5.7 per cent from a year earlier.
While the introduction of GST and subsidy rationalisation efforts were absolutely necessary to diversify our revenue base and strengthen our finances, the Malaysia Consumers Movement (MCM) calls on the government to immediately extend a helping hand to low- and middle-income consumers, who are the primary drivers of domestic private consumption.
And implementing a peoplecentric budget is the best way to achieve this.
We must accept the fact that in an open market economy like ours, prices of goods and services are essentially determined by market forces.
It is therefore unfair to expect government intervention to regulate prices, but what the government can do is implement measures which will help improve individual’s personal finances.
While long-term policy measures are in place to achieve highincome developed-nation status, immediate government intervention to help ease cost pressures on the people would be greatly appreciated.
The MCM, therefore, recommends that the measures below be considered:
quantum of individual income tax relief;
quantum of child support tax relief;
quantum of EPF contribution relief; and
quantum of medical insurance relief.
The government can supplement this revenue shortfall by strengthening its austerity measure, plugging leakages, strengthening tax collection by efficiently checking illicit trade while hunting down tax dodgers and declaring an all-out war on corruption.