EY Malaysia: Budget 2018 promises positive outlook
We continue to embrace latest trends in the formulation of our economic and fiscal policies.
KUALA LUMPUR: The 2018 Budget promises a positive outlook and inspires investor confidence in the nation, EY Malaysia opines.
In EY Malaysia’s post-budget commentary, EY Malaysia partner and Tax leader Amarjeet Singh, said Budget 2018 is an inclusive budget, with measures laying the foundation for long-term and sustainable growth.
“We continue to embrace latest trends in the formulation of our economic and fiscal policies,” Singh said.
“There is a strong focus on the private sector, and recognition of the role of small and medium enterprises (SMEs) in driving growth.”
Singh noted that the measures promote a conducive ecosystem for the private sector and SMEs through easier access to funding, support for talent development, creation of regulatory sandboxes for innovation and reach to global markets such as the Digital Free Trade Zone.
He further noted that the fact that these measures extend even to micro entrepreneurs demonstrates the depth of the initiatives in place.
“The government continues
Amarjeet Singh, EY Malaysia partner and Tax leader
to encourage evolution in the manufacturing sector with specific measures such as an enhanced capital allowance on automation equipment and an extension of the Domestic Investment Strategic Fund to cover Smart Manufacturing facilities.
“It is hoped that this, together with the increase in minimum wage last year, will reduce Malaysia’s reliance on foreign labour.”
Despite this budget being labelled as election-focused, Sing revealed that they are encouraged that the government remains steadfast in its commitment to reduce the budget deficit to 2.8 per cent of gross domestic product (GDP) in 2018.
Sing highlighted that the government continues to support the B40 with BRIM and expansion of the zero rated list for goods and services tax (GST) to include reading materials and maintenance fees for stratified properties such as flats and condominiums.
He also highlighted that for the middle-income earners, a significant measure has been introduced to reduce income tax rates by two per cent for chargeable income between RM20,000 to RM70,000, as well as the continuance of the Skim Simpanan Pendidikan Nasional (SSPN) tax relief.
“These measures should alleviate some of the burden arising from the rising costs of living,” he said.