Budget 2023: An inspiring budget for all

KUALA LUMPUR: Prime Minister Datuk Seri Anwar Ibrahim today tabled an expansive and, according to some industry leaders, "inspiring" 2023 Budget.

It boasts higher allocation for development and generous handouts, particularly for the low and middle-income groups, civil servants and those who were insolvent.

This year's annual bill is larger than the previous all-time high of RM372.3 billion under the original 2023 Budget tabled by Anwar's predecessor Datuk Seri Ismail Sabri Yaakob but was not passed last October.

Of the RM388.1 billion, a total of RM289.1 billion is for operating expenditure (OE) and RM99 billion for development expenditure (DE), besides RM2 billion as contingency fund.

The amount for DE is the country's biggest development expenditure so far.

This year's larger DE comes on the back of expectations that government revenue will drop slightly to RM291.5 billion, or 15.4 per cent of gross domestic product (GDP).

Themed "Membangun Malaysia Madani" (Developing Malaysia Madani), Anwar's revised budget represents a balancing act between the need to support the domestic economy and determination to continue with fiscal consolidation.

It is focusing on addressing the high cost of living, strengthening the social safety net and enhancing the micro, small and medium enterprises (MSMEs) ecosystem.

Anwar is trying to achieve this by, among others, enhancing tax collection effectiveness and plugging leakages as well as broadening the revenue base.

This is through the reintroduction of tax on luxury goods and capital gains tax on shares in unlisted companies.

The government's allocation of RM8 billion towards Sumbangan Tunai Rahmah will help alleviate difficulties of 8.7 million people in the B40 category burdened by rising living costs.

Personal income tax cuts amounting to RM900 million will see at least 2.4 million people in the M40 category benefitting.

In a surprising but highly-compassionate move, the government will deposit RM500 into the accounts of the Employee Provident Fund contributors aged between 40 and 54 with savings of less than RM10,000 in their accounts.

This is expected to benefit two million members, involving an allocation of RM1 billion.

The spirit of inclusiveness is evident in 35.2 per cent or about RM136 billion allocated for programmes and projects under the social sector and 19.1 per cent or about RM74 billion towards reshaping the economic landscape of the country.

This will continue to ensure income gap between the rakyat and the development gap among the states are reduced further.

The revised budget is enhancing Malaysia' long-term growth potential via investments in infrastructure, health care facilities and educational institutions under the 12th Malaysia Plan.

For instance, Malaysia will expand the capacity of Penang and Subang airports, which is timely given the increasing international visitor arrivals, especially with China's reopening.

Government agencies' continued provision of financing and guarantees amounting to RM40 billion for the benefit of MSMEs, Bank Negara Malaysia's RM10 billion financing facility for SMEs and guarantees of up to RM20 billion provided by Syarikat Jaminan Pembiayaan Perniagaan will provide a much needed lift for businesses.

The revised 2023 Budget deficit has been planned at 5.0 per cent of GDP, which is an improvement from the 5.6 per cent of GDP for 2022.

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