KUALA LUMPUR, MALAYSIA – Media OutReach – 10 November
2020 – Helping people navigate the rough times as well as sustaining businesses
took centre stage at the Malaysian budget 2021 on Friday, but there were a host
of other initiatives designed to elevate the living standards of Malaysians.
Below are some examples of budget
announcements you may have missed.
Rural connections boosted
A total of RM1.3 billion (AUD1.03 billion) is
allocated to build trunk roads, provide water supply (RM632 million or AUD2.1
million) and electricity (RM250 million or AUD83.4 million).
Research and development
A RM400 million (AUD133 million) allocation
for research and development will be channelled to universities and government
agencies to ramp up Malaysia’s endeavour to become a knowledge economy.
To support that announcement, tax incentives
for non-resource-based R&D product commercialisation activities will be
reintroduced and tax incentives for the commercialisation of R&D products
by public research institutions will be extended to private higher education
institutions.
Housing
A total of RM500 million (AUD166.8 million)
has been allocated to build 14,000 homes for people on lower incomes, while
another RM125 million is set aside to build low-cost flats for the urban poor.
Civil servants also get assistance, with RM310
million (AUD 103.4 million) earmarked for homebuilding.
The full stamp duty exemption for first time
home buyers has been extended until 31 December 2025 and the limit on the
exemption has been increased to properties valued at RM500,000 (AUD170,000
(from RM300,000), enabling homebuyers to save up to RM9000 (AUD3000) in stamp
duty.
Encouraging healthier lifestyles
Malaysians have the highest incidences of
hypertension, diabetes, lung cancer and other non-congenital diseases in South
East Asia.
To foster a healthier lifestyle, a total of
RM19 million (AUD6.3 million) has been allocated for sports development and
RM103 million (AUD34.36 million) to build, maintain and upgrade sports
facilities.
A total of RM55million (AUD18.5 million) has
been allocated to further boost the development of hockey, rugby, badminton and
women athletes.
Mental wellbeing
The Health Ministry has been allocated RM24
million (AUD8million) to assist with mental health issues, such as depression,
arising from the pandemic lockdown.
Assisting people with disabilities
Allowances for the disabled were increased
from RM250 to RM300 (AUD100). The allowance for those who are bedridden,
suffering from chronic disease, will receive RM500 (AUD166) a month.
The rate for the Incentive Allowance for
Disabled Workers will increase from RM400 to RM450.
Fishing industry receives a boost
Some 40,000 people working in the fishing
industry will get an increase in their allowances to RM300 (AUD 100) from RM250
(AUD83).
Empowering female entrepreneurs
A total of RM95 million (AUD32 million) micro
credit has been allocated to assist women especially those in rural areas to
start a business.
Aid for indigenous peoples
For 2021, a total of RM158 million has been
allocated for the indigenous people of Malaysia to assist them with living
expenses, building or repairing houses, food and education and travel.
Rebate for the purchase of “green”
refrigerators
A RM200 (AUD66) rebate will also be offered to
buyers of “green” refrigerators and air conditioning units, as part
of Malaysia’s efforts to become a green nation. The appliances must be locally
manufactured.
Cleaning up the rivers
Malaysian rivers continue to be polluted by
illegal factories and irresponsible dumping. To combat this scourge, a total of
RM50 million (AUD16 million) will be spent to clean up rivers, increase
enforcement and erect observatory towers to clamp down on polluters.
Improving Malaysia’s digital capability
The government is taking additional steps to
reduce the financial burden lower income Malaysians experience in accessing the
internet.
In the first quarter of 2021, an estimated 8
million individuals in the B40 category will each be eligible for a
telecommunications credit worth RM180 to help pay for internet subscription or
buy new mobile phones. Telecommunication companies will also provide benefits
to this group such as free data.
In addition, the government is allocating
RM150 million to 100,000 businesses to encourage the adoption of e-commerce,
which will be supplemented by the RM150 million Shop Malaysia Online
initiative.
The eligibility for the SME Digitalization
Grant Scheme and Automation Grant has been broadened to businesses that have
been operating for at least six months and a further RM150 million has been
injected into the scheme.
Promoting e-wallets
A one-off RM50 (AUD16.68) payment will be
credited into the e-wallets of Malaysians between the ages of 18 and 20. This
is to bolster a cashless society as Malaysia migrates to e-wallet transactions.
E-wallets have taken off significantly in the
country, of which there are some 20 providers.
Supporting the unemployed
To assist Malaysians that have recently lost
work due to COVID-19, the Budget proposes to increase the cap on the income tax
exemption for compensation received on the loss of employment from RM10,000 to
RM20,000 for 2020 and 2021.
The hiring incentive, now known as
PenjanaKerjaya, has been enhanced and includes an increase in the incentive
employers receive when hiring disabled, long-term unemployed and retrenched
workers. The 20 per cent increase brings the total incentive an employer may be
eligible for to 60 per cent of that employee’s monthly income.
The government and Government Linked
Corporations will offer 50,000 job opportunities on a contract basis starting
January 2021. The government will give priority to filling up positions such as
nurses, medical attendants, social workers and temporary teachers.
Government loans will be provided to 24,000 trainees
to pursue technical and vocational education and training (TVET) programs in
public and private skills training institutions.
The government will also provide training and
placements for 8000 employees of airline companies in Malaysia.
Tax incentives for business
The government announced several business tax
incentives in the Budget including:
- relaxing the conditions for the
Principal Hub incentive and extending the incentive until 31 December 2022 - taxing the income of global trading
centres at a concessionary 10 per cent rate for five years and renewable for
another five years - taxing non-resident individuals
holding key positions in companies investing in new strategic industries at a
flat 15 per cent for five years - pharmaceutical manufacturers will be
taxed at 0 to 10 per cent for 10 years and at 10 per cent for a subsequent ten
years - all tax incentives due to expire this
year will be extended until 2022.
A comprehensive study of existing tax
incentives is underway. The intention of the study is to provide a competitive,
transparent and more attractive tax incentive framework.
For further information, visit the CPA
Australia website.
About CPA Australia
CPA
Australia is one of the world’s largest accounting bodies, with more than
166,000 members working in 100 countries and regions and supported by 19
offices globally. Our core services to members include education, training,
technical support and advocacy. Employees and members work together with
local and international bodies to represent the views and concerns of the
profession to governments, regulators, industries, academia and the community.
Visit cpaaustralia.com.au
