KUALA LUMPUR – The M40 group, though not mentioned much in Friday’s Budget 2021 tabling, will be given billions in aid to help them weather the Covid-19 pandemic and ensuing economic crisis, said Datuk Seri Tengku Zafrul Tengku Abdul Aziz.
The finance minister told TV3’s Buletin Utama programme tonight that tax-paying middle-income earners are not receiving “any less” than others, and stand to gain RM10 billion in incentives and other assistance.
Personal income tax will be reduced by 1% for those earning RM50,000 to RM70,000 a year, he said, and Employees Provident Fund contributions will drop to 9% from 11% a month.
He added that the M40 will benefit from this, and it will allow RM9.3 billion to flow into the economy.
“There are also targeted easy-access payments for affected groups. Also, the announced (loan) moratorium involving the M40.
“After we (government) had talks with the banks, they (M40) only need to make a self-declaration to obtain approval (for the moratorium), where they can say they have lost their source of income or jobs.”
He said the government cannot look only at the short-term issues faced by this group, which is why it wants to create 500,000 jobs.
This will help the low-income group, too, he said.
On the national debt ceiling, Tengku Zafrul said the Dewan Rakyat has agreed to raise it from 55% to 60% of gross domestic product, which is sufficient for now.
By year-end, he said, Malaysia’s debt-to-GDP ratio could hit 56%, adding that every 1% increase amounts to RM15 billion.
“So, if there is an increase from 60% to 65%, our national debt will increase by RM75 billion. But, there is still space for us to increase our spending as announced in Budget 2021.
“If we see the (Budget) announcement on the debt-to-GDP ratio, it is expected to rise from 56% at the end of the year to nearly 60% in 2021.
“Whether we decide to raise this depends on how we tackle Covid-19.” – The Vibes, November 8, 2020
