Accounting Bodies Give Thumbs Up for Malaysia Budget 2021
According to a report by E&Y, PWC and MIA (Malaysian Institute of Accountants), the recent Malaysian budget for 2021 sets to be the largest ever in its history.
“At RM322.5b, Budget 2021 is the largest budget in Malaysian history”, said Amarjeet Singh, EY Asean and Malaysia Tax Leader. “It is a fit-for-purpose Budget which meets the immediate needs of the country to encourage recovery, growth and investment. It is now key to monitor and measure the implementation of the Budget closely against the desired objectives. Also consider how our neighbours in the region are reacting, especially in terms of incentive offerings. As we saw at the beginning of this year, the COVID-19 pandemic has created significant uncertainties. Economic conditions may change very rapidly, depending on the continued impact of the virus and the length of time it takes to develop a vaccine. As such, the Government needs to be agile. The government must prepare to revisit and supplement the Budget measures as and when necessary”, he added.
Budget 2021 is an expansionary document for extraordinary times. “It does not just provide support to businesses, workers and households in this current fragile economic situation. It also drives continued focus on digital transformation and upskilling of workers for the future,” said MIA President Dr Veerinderjeet Singh in an initial response to the Budget.
PWC said that this budget is a behemoth budget for unprecedented times.
B40 Group still a focus
Budget 2021 continues to address the immediate needs of the most vulnerable. It does this through the continuation of targeted stimulus measures, especially for the B40 group. The proposed measures include firstly, allowing additional EPF withdrawals of RM500 per month for 12 months. Secondly, additional cash support under the Bantuan Prihatin Rakyat scheme. Thirdly, targeted health-related tax reliefs for individuals, as well as extending the wage subsidy programme. There were also measures to encourage the public sector and GLCs to offer short-term employment for positions such as nurses, medical attendants, social welfare officers and temporary teachers, as well as incentives for reskilling and upskilling.
The Government continues to take a long-term strategic view by providing the highest allocation of the Budget to the education sector for the third year in a row. The funding for development expenditure is also encouraging, at more than 40% of public spending, the highest in 10 years. The development expenditure budget sees RM15b allocated for crucial infrastructure projects such as firstly, the Pan-Borneo highway. Secondly, the Gemas-Johor Bharu double-tracking and electrification project. Finally, Phase 1 of the Klang Valley Double Track project, to spur spending in the short term. The building of a robust infrastructure network, including an upgrade of broadband infrastructure, is also noteworthy.
MIA happy to help in budget finetuning
“The measures outlined in Budget 2021 are meant to stimulate the economy, enhance social and health safety nets. The budget also protects business continuity and drives long-term sustainable development reforms. In line with our nation-building purpose, MIA is ready to deploy its expertise to support the implementation of the Budget proposals.
We look forward to contributing significantly in areas relating to business continuity, sustainability planning, digital transformation, as well as upskilling through professional development and education, among others,” said MIA CEO Dr Nurmazilah Dato’ Mahzan.
“The Institute recognises that COVID-19 is an evolving situation. We will continue to discuss with relevant Government agencies to provide feedback to finetune the support measures,” she concluded.
This budget is the first developed by Datuk Zafrul, the current Malaysian Finance Minister. Before he was appointed Minister of Finance, Datuk Zafrul was the CEO of CIMB.
For more information on the reports, visit the respective links below.
MIA
