Monday, October 26, 2009

MV: 1Malaysia Budget 2010



5 days after the "my mlm experience" post, I have to forget the loss I suffered and moving on with my life. And yea, the budget 2010 had just over. Our PM announced the new budget titled "1Malaysia, together we prosper", sounds nice huh! I am writing this post to examine what I support and what I don't support in the budget 2010. Everything discussed related to personal finance =)

Highlights
- 1 Malaysia clinics to be set up in urban areas.
- Convertion of PTPTN loan into scholarship if graduate with 1st class honours.
- 30 top students to get merit-based scholarships for world renowned universities.
- Tax relief up to RM500 on broadband subscription fees (2010 - 2012)
- RM1 billion for the police to enhance their efficiency.
- 1 Malaysia Retirement Scheme to enable non-fixed income earners to contribute to EPF. For every RM100 contributed, Government will contribute 5%.
- Personal relief increased from RM8,000 to RM9,000.
- Income tax reduction from 27% to 26% for income above RM100,000.
- Service charge for credit card (principal card - RM50, supplementary card - RM25)
- (RPGT) Property gain tax makes comeback, up to maximum of 30%.

I support....
~ 50 unit of 1Malaysia clinics are scheduled to open in selected areas. Ultimately, I hope rakyat can wait in a modern clinic with good air-conditioning and equipped with ASTRO.
~ Finally our government allow PTPTN loan to be converted into scholarship if he/she obtain 1st class honours in tertiary education. Walao, I am sure alot of student would eat and digest the entire text book to enable them getting 1st class. (One question, when will it be started?)
~ 30 top students get to study overseas, anywhere they like. (Hope that race quota system don't apply anymore, 1Malaysia rite?)
~ Tax relief of RM500 for broadband subscription will start on 2010 to 2012. (I can save RM1,000 for my Streamyx payment, but I am still unemployed currently. Sigh!)
~ RM1 billion for the police to buy better equipment? Or a cup of coffee? Pray for the crime rate to drop, please make Malaysia a safer country.
~ I think those casual workers can put their money in EPF since the government offer 5% interest rate p.a. It is better than putting in FD.
~ Personal relief of extra RM1,000 will be given solely on annuity scheme premium from insurance companies that commence payment from Jan 1 next year.

I don't support....
~ The reduction of maximum income tax rate only benefit certain group of rakyat. Especially those with high earnings. But think of one question, how many people are earning RM 100,000 annually? It is a fact that more than 50% of Malaysians are earning less than RM3,000 monthly. Such implementation will only help the rich to get richer and the poor get nothing out of it.
~ Normally people spending "future money" with credit. However, those people that owe credit card loan are mostly low and middle income group. Applying an extra RM50 will not reduce the rising non-performing loan in credit card, and will increase the burden of the rakyat. I am sure that there are other alternatives to reduce default in credit card loan such as strengthen the application requirement, limit the number of cardholding, and etc. The service on credit card will be effective by 1st of Jan 2010.
~ The RPGT make a comeback after government make an exemption on April 2007. Some exemption still in place. However, the property market in Malaysia might not be attractive to investors compare to its neighbour countries.

Conclusion:
As a rakyat, I personally think that the new budget 2010 has more pros than cons. However, I hope the government will put more care on the low and middle class citizens. Obviously, the poor needs more attention than the rich.
Secondly, there is a need to set up the minimum wage for the rakyat to maintain their standard of living. As the inflation grow faster than our salary, the standard of living is deteriorating.
Another area I want to touch is the possible imposition of goods and services tax (GST) to replace current sales tax and service tax, such idea is still under review. I pray again for the government not imposing GST on low and middle income group.
Lastly, I hope the size of federal funding to various states government to be rationalize by the rakyat's needs and with proper planning, not by political agendas.

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