FORMER Finance Minister Lim Guan Eng has once again taken centre stage in shaping Malaysia’s economic policy, presenting a set of proposals to Prime Minister and current Finance Minister Datuk Seri Anwar Ibrahim aimed at stimulating domestic spending and safeguarding the nation against global economic uncertainties.
The Bagan MP handed over a personal memorandum outlining six key recommendations, largely aligned with a submission made last month by his colleague, Transport Minister and DAP Secretary-General Anthony Loke Siew Fook.
Lim emphasised that the proposals are designed to place more money in the hands of average Malaysians, thereby boosting public expenditure and countering rising living costs.
“I'll appreciate the attention accorded by Anwar to the issues which we have raised. It is designed to boost domestic consumption and economic posterity,” Lim said.
Among the principal measures suggested by Lim are the allocation of 10% of federal funding to non-Muslim communities to increase household spending, a temporary freeze on the expansion of the sales and services tax implemented last July, and mandatory sourcing of 50% of construction materials from local suppliers while imposing a 10% levy on imported coal and iron ore.
He also proposed exemptions for local small and medium enterprises (SMEs) from annual e-invoicing requirements, the establishment of a tribunal to expedite corporate and personal tax rebates, and temporary freezes on a two percent Employees Provident Fund contribution for foreign workers and the two percent income tax on dividends exceeding RM100,000 for non-public listed companies.
Beyond these six measures, Lim suggested additional reforms aimed at easing pressures on both employers and employees.
These include lowering corporate taxes for SMEs, cancelling CP500 tax instalment repayments for workers under the monthly salary deduction scheme, accelerating the digital registration of foreign workers, and gradually raising the personal income tax relief threshold from RM3,000 to RM12,000 over 12 years to mitigate the impact of escalating living costs.
“I am confident that the economy can be boosted with the measures we have suggested while also injecting more confidence to the people, so they can reinvest the extra savings into the economy,” Lim said, expressing hope that Prime Minister Anwar Ibrahim will give careful consideration to the recommendations. - January 19, 2026
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