KUALA LUMPUR – The government must expedite the implementation of the Fiscal Responsibility Act as one of the fiscal reforms, Kangar MP Noor Amin Ahmad said.
He said with the operating expenditure reaching almost 100% of tax collection, the government cannot avoid continuing to raise debts to accommodate the development expenditure.
“The Finance Ministry (MoF) has proposed to table the Fiscal Responsibility Bill, so I hope MoF will not delay and hold discussions quickly in order to table the bill in the Dewan Rakyat,” he told the media in Parliament today.
Noor Amin also asked the government to raise the country’s debt ceiling to 70% from 65% at present as it needs to inject additional stimulus by generating new debts as the economic situation is still sluggish.
He said MoF has projected that the debt ratio will increase to 66% of gross domestic product by year-end, a 1% increase from the debt statutory limit approved through an amendment made in 2020 to address the impact of Covid-19 under the Loan (Local) Act 1959 and Government Funding Act 1983.
“The basis of my concern is related to a written reply that stated that 43.4% of the government’s debt will mature in five years,” he said.
He said the government’s debt ratio projection of 66% this year is rather optimistic with Prihatin, Penjana, and Pemerkasa’s expenditures at 65%, 57.3%, and 38.2% respectively.
“Taking into account the total Budget 2022 allocation of RM322.1 billion as a benchmark and total revenue collection of about RM234.0 billion, this means that the deficit expenditure is around RM88 billion,” he added.
“The introduction of new taxes at a time when the country has not yet fully recovered from the pandemic will further burden the people, who are still reeling from the impact of rising prices of goods,” he said, adding that it is important that the government answers this issue immediately. – Bernama, March 23, 2022
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