Govt does not intend to impose inheritance tax in 2020 Budget

KUALA LUMPUR: The government has no intention of imposing new taxes in the upcoming 2020 Budget especially in regards to the inheritance tax, said Finance Minister Lim Guan Eng.

He said there are a lot of rumours alleging that Pakatan Harapan government intended to introduce inheritance tax.

“It is unlikely. If there are, it is just a follow up of what we have announced in 2019 Budget,” he told reporters during Malaysia SME Business Summit yesterday.

Speculation about the introduction of inheritance tax has been swirling since prior to the tabling of the 2019 Budget, which the market feared would discourage investors’ interest, especially on Bursa Malaysia.

The government, however, did propose ways to increase its tax revenue including via the special voluntary disclosure programme which allows taxpayers to voluntarily declare any unreported income, including income kept in offshore accounts.

Asked on the performance of the small and medium enterprises ( SMEs) during the first half of 2019, Lim said the government acknowledged numerous challenges faced by them, including issues on access to financing as well as on the rescheduling and restructuring of loans.

“Some companies would like to reschedule their loans for a longer term so that they can improve their cash flow and they will still 4.0.

Additionally, RM1 billion is dedicated to bringing the Bumiputera SMEs up, which is part of RM6.5 billion SJPP guarantee scheme to ease SMEs’ access to financing.

“The government also provides an RM3 billion Industry Digitalisation Transformation Fund under Bank Pembangunan Malaysia Bhd (BPMB) to accelerate the adoption of new technology including artificial intelligence, automation, big data and robotics among Malaysian companies”.

Lim also said another challenges faced by the SMEs are the civil service.

“Sometimes they still give problems, we still need to get them to support the government’s policies initiatives. We do get a lot of complaints, (such as) deliberately making things difficult for business, but that will take time.

“You cannot overcome 61 years in one year, so we hope they can be patient, let us deal with step by step, stage by stage,” he said while emphasizing on the need for SMEs to embrace the digital world.

In 2017, SMEs contributed 37 per cent to the Malaysian gross domestic product and that figure is expected to rise to 41 per cent by next year.

SMEs is also the biggest employer in the country, employing two-thirds of all workers in Malaysia and made up 98.5 per cent of all business establishments in the country. — Bernama KUALA LUMPUR: Vitol, the world’s largest independent oil trader, has started building a small oil refinery at its storage terminal in Malaysia that will provide low-sulphur fuel for ships, a senior company official said on Monday.

The project consists of a crude distillation unit that can process 30,000 barrels per day of crude and is located on the same site as Vitol’s oil storage terminal at Tanjung Bin in the southern Malaysian state of Johor, Vitol Asia’s President and Chief Executive Officer Kho Hui Meng said.

A construction unit under China National Petroleum Corp (CNPC) is handling the project which will involve moving a second-hand CDU from China to KUALA LUMPUR: Oil prices are expected to trade around US$65 to US$75 per barrel in the second half of this year (2H19), but continuous geopolitical conflicts could push it higher, said FGE chairman and founder, Dr Fereidun Fesharaki.

FGE is a leading consulting group focusing on the global oil and gas markets.

The benchmark Bent crude is now being traded at US$64.22 per barrel.

Fesharaki also said over the next few years, oil prices are projected to range between US$60 per barrel and US$70 per barrel.

“As for the short term view, barring economic collapse, demand growth for oil is solid at around one million barrels per day,” he said in his special address at the ‘Conference the site, he said on the sidelines of the Asia Oil & Gas Conference.

The project is expected to be completed in May 2020 and will augment Vitol’s refinery in Fujairah in the United Arab Emirates in providing lowsulphur fuel oil for ships, Kho said.

The global shipping industry will switch to marine fuel, known as bunker fuel, containing 0.5 per cent sulphur or less from the start of 2020, down from the current 3.5 per cent, as mandated by the International Maritime Organization.

Companies such as Germany’s Uniper and the United Arab Emirates’ Brooge Petroleum and Gas Investment Co ( BPGIC) are either expanding their plants or building a new refinery in Chairman Crystal Ball: Energy Outlook’ session yesterday.

The session was held in conjunction with the 20th Asia Oil and Gas Conference (AOGC) 2019.

Elaborating further on oil prices, Fesharaki said the oil production cut by the Organisation of the Petroleum Exporting Countries (OPEC) and non-OPEC in December 2016 and December 2018, had led to the strengthening of prices.

“But, when they relaxed the cut, the prices fell again. The current price level is influenced by downward sentiment in the market, rather than escalating trade tensions between major economies,” he added.

He noted that over the short term, weaker demand for crude oil is deemed as a major factor, as compared to the impact of the Fujairah, a ship refueling hub on the east coast of the UAE, to meet rising demand.

The new Malaysian refinery will be able to process a wide variety of low- sulphur oil available in the market including US West Texas Intermediate crude that Vitol trades in, Kho said.

Production of low-sulphur fuel from Vitol’s new refining unit will be just in time to meet rising demand as current stockpiles of such fuel in the region would have been drawn down by the middle of next year, he said.

Major oil companies and trading houses are stocking up low- sulphur bunker fuels in anticipation of a surge in demand for the fuel in 2020. — Reuters trade war.

“The impact of the trade war on the gross domestic product and economy of countries is yet to be seen. In fact, the global economy, has been growing at a slower pace,” he said.

Commenting on the Liquified Natural Gas (LNG) segment, Fesharaki said a flood of projects in the US and Australia in 2019 and 2020 would lead to a collapse in spot LNG prices of US$3.5 to US$4.5 one million thermal units (mmbtu) in Europe and Asia.

“The last of these LNG projects came in late next year. Thereafter, the flood stops and for the medium term, the LNG market is expected to tighten and with limited new volume and annual demand growth of about four per cent, the spot prices will rise above contract prices,” he added. — Bernama

Lim Guan Eng