SERC expects leaner, meaner but supportive Budget 2019

KUALA LUMPUR: The Socio-Economic Research Centre (SERC) expects a leaner and meaner but supportive Budget 2019.

The think tank's executive director Lee Heng Guie told reporters at a media briefing that the percentage of growth of both operating and development expenditures could be reduced.

Besides emoluments, debt services and pension which are fixed components of the opex, the government might be weighing on areas where it can cut its spending or rationalise expenditure.

On development expenditure, Lee said the mid-term review of the 11th Malaysia Plan could provide a guidance on how this will materialise in the Budget.

Necessary yet unpopular fiscal restoration measures and new taxes could also help plug the large financing gap in the budget.

The focus of this upcoming budget according to Lee is likely be on rationalising fuel subsidies and cost saving in terms of procurement while cost of living aid is likely to reviewed to make it conditional.

Lee added that corporate tax and individual income tax is unlikely to be raised.

He noted that new form of taxes such as soda tax, inheritance tax, capital gain tax on share transaction and e-hailing or e-commerce/ digits business tax are some taxes the government could take into consideration.

SERC's proposed measures and initiatives for Budget 2019 to ease cost of living includes tax relief on rental, discount on food card at eateries, reintroducing RM100 monthly pass for unlimited LRT and bus rides, incentivising rent-to-own scheme and strict price surveillance and enforcement.

It has also proposed for an independent panel to be set up to review cost of doing business, streamlining regulatory practices and compliance cost.

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The Budget 2019 to be tabled on November 2, will be the first by the Pakatan Harapan government.

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