VIDEO

Here is the video link about budget that everyone can click and see. Lets enjoy guys !!!

 https://youtu.be/ar5XILjmAWA

CONTENT ( MALAYSIA BUDGET TO FACE THE CHALLENGE OF COVID 19)

 

ANOTHER BUDGET WITH LARGE ALLOCATION EXPECTED TO HELP MALAYSIA FACE THE CHALLENGE OF COVID-19 IN 2022

Minister of Finance statement that confident to prepare well budget to nation

While Malaysia is in the final stages of its 6R strategy (assertiveness, resilience, regeneration, recovery, empowerment and restructuring) to emerge from the COVID-19 pandemic and move into the endemic phase, all eyes will be on Budget 2022 and the benefits it offers. The government is expected to continue to focus on measures to protect lives and restore well-being, rebuild businesses and catalyse post-pandemic reforms.

As the first budget under the government of Prime Minister Datuk Seri Ismail Sabri Yaakob and the first since the launch of the 12th Malaysia Plan (12MP), Budget 2022 is expected to continue to feature expansion and be a catalyst for the implementation of the 12MP that will drive economic growth, inclusion and sustainability in medium term, based on the Sustainable Development Goals (SDGs) and the Vision for Shared Prosperity 2030 (WKB 2030).

According to the first Pre-Budget Statement issued by the Ministry of Finance (MoF) in August, the government will ensure the budget is comprehensive and inclusive, in line with the spirit of "Keluarga Malaysia", with no individuals or businesses left behind in receiving government assistance and support, especially those. which was severely affected by the prolonged Movement Control Order (PKP) in 2021.

The 2022 Budget, tabled in Parliament on Oct 29, 2021, will also ensure the continuity of the National Recovery Plan (VAT) in driving economic recovery, according to the MoF. To help the country recover from the health and economic crisis, analysts expect another budget with a large allocation this time, compared to RM322.5 billion announced in the previous budget (which was later revised to RM314.8 billion).

The healthcare sector is seen as the biggest beneficiary despite the Federal government debt rising to 61.2 per cent of Gross Domestic Product (GDP), with a statutory debt level of 56.8 per cent as of June 2021. The 2021 Budget was the largest in Malaysian history when it was announced last year.According to UOB Bank Economists Julia Goh and Loke Siew Ting, total government spending is projected to increase 2.9 per cent to RM338 billion in 2022, making it larger than the previous budget. The government is also expected to continue to assist the sectors worst affected by the pandemic such as tourism, retail and micro, small and medium enterprises (SMEs).

“This will be partially offset by an estimated revenue collection of RM230 billion, resulting in a fiscal shortfall of RM107.3 billion in 2022. The budget gap is equivalent to 6.5 per cent of GDP next year, smaller than the estimated seven per cent of GDP this year information in the note Continuous measures to upgrade the skills and retrain of workers can also be seen in addition to protecting and creating new employment opportunities for the people.

"Perhaps this budget announcement will provide more clarity on how the government plans to reduce the budget gap, based on the 12MP has shown a fiscal shortfall of 3.0 to 3.5 per cent of GDP by 2025, compared to the 2022 estimate of 6.5 to 7.0 per cent," said the Bank's chief economist. Islam, Mohd Afzanizam Abdul Rashid.

In terms of tax revenue, despite requests for the government to study to implement the extraordinary gains tax and capital gains tax or reintroduce the Goods and Services Tax (GST), experts expect no new taxes to be implemented in Budget 2022 due to the uncertain environment due to COVID- 19 at the domestic and global levels which could affect the stability of Malaysia's economic growth.

However, in its Pre-Budget Statement, the MoF stated the government is considering measures to increase tax revenue through increased tax compliance. Proposals in the study include the implementation of a Special Voluntary Disclosure Program (SVDP) for indirect taxes administered by the Royal Malaysian Customs Department (JKDM). It also proposed the introduction of a tax compliance certificate as a pre-requisite for tenderers participating in government procurement.

"Third, the implementation of tax identification numbers (TINs) and review of tax implementations identified as having elements of revenue leakage or harmful practices. A comprehensive review of the tax incentive framework was also conducted to ensure tax incentives offered to foreign and local investors remain relevant. with the current business landscape in addition to continuing to maintain the country's competitiveness in attracting quality investment.

 

CONTENT (SOCSO BUDGET 2022)

SOSCO BUDGET 2022

Following the presentation of the 2022 Budget by the Minister of Finance, YB Senator Tengku Datuk Seri Zafrul Tengku Abdul Aziz on 29 October 2021, the Social Security Organization (SOCSO) welcomed the plan outlined by the Malaysian Government on efforts to strengthen the country's economy, especially those involving social safety net expansion initiatives. and the empowerment of active labor market programs. As an agency under the Ministry of Human Resources (MOHR), SOCSO will provide full support to the Government and is committed to implementing all Budget 2022 initiatives involving this agency. We are also confident that the essence of the budget themed "Malaysian Family, Prosperous" will benefit the people as a whole, in line with the reopening of more economic sectors by 2022(Chief Executive PERKESO 2021).Below are budget under SOSCO:

SOCSO PROGRAME AND INCENTIVE

1.Kasih Suri Keluarga Malaysia Program

With the inclusive spirit of the Malaysian Family, the Government through SOCSO will expand its social security coverage specifically for women among housewives through the Kasih Suri Keluarga Malaysia Program. The social protection network under the provisions of the Housewife Social Security Act will use the same approach as SOCSO's contributions imposed on other employees. In addition to empowering and defending the fate of housewives, this program also aims to protect them in the event of any disasters and untoward incidents.

2.SIP Targeted Wage Subsidy

The 2022 Budget also does not sideline efforts to rehabilitate the tourism sector which has been severely affected by the COVID-19 pandemic. Accordingly, a total of RM600 million has been allocated for the implementation of the Targeted Wage Subsidy Program. Under this initiative, tour operators who experience a decline in income of at least 30 per cent of total sales or monthly income can apply for this incentive. This subsidy assistance is expected to benefit a total of 26,000 employers involving 330,000 workers from this sector. Beginning in 2022, the Wage Subsidy Program will be rebranded as the Wage Subsidy SIP and in line with that, the Targeted Wage Subsidy Program will also be rebranded as the Targeted Wage Subsidy SIP.

3. SIP Job Seeking Allowance+

To assist and encourage unemployed individuals to find employment, the Government will continue to provide Employment Allowance (EMP) assistance under the SIP to SOCSO contributors and non -contributors. This initiative is an improvement to the SIP Prihatin 1.0 and SIP Prihatin 2.0 programs and is expected to benefit a total of 265,000 individuals who are actively seeking employment. These measures to improve the EMP incentives can also have a positive impact on the macro job market, thus helping to reduce the country's unemployment rate. Beginning in 2022, the expansion and continuation of this program will be rebranded using the name SIP Job Search Allowance+ or SIP EMP+ to replace the name SIP Prihatin.

SIP EMP+ assistance under Budget 2022 will be implemented as follows:

a. SOCSO contributors

Grant of allowance for a period of nine (9) months with a claimable rate of 80 percent of salary for the first month, 50 percent of salary for the second to sixth month and 30 percent of salary for the last three (3) months. Employees who lost their jobs in 2021 who are still unemployed are also eligible to receive an additional allowance for 3 months under SIP EMP+.

b. Not a SOCSO contributor

Allowance of RM300 per month for a period of 3 months. An additional allowance of RM400 will be paid directly to applicants successfully placed into employment.

4.Increase in the Salary Limit for Contributions and the Minimum Rate of Disability Scheme Pension

Concerned with the plight of the people who lost their breadwinners in the family as a result of COVID-19, an allocation of RM267 million will be given to SOCSO to improve its operations involving the contribution rate and benefits offered. Among them is to increase the ceiling of the insured monthly salary from RM4,000 to RM5,000, which will involve a total of 9 million SOCSO contributors nationwide. In addition, the minimum rate of Retirement Pension paid to eligible Dependents will be increased from RM475 per month to RM550 per month or approximately 15.8 percent increase from the existing rate. The move will benefit as many as 56,000 households. This initiative will be followed by the coordination of other SOCSO benefits, in line with the rising cost of living and is expected to benefit more than 400,000 existing beneficiaries.

5. SPS Khidmat, SPS Gig, SPS Usahawanita, SPS Tani, SPS Jaja, SPS Seni, SPS Lain Upaya, SPS Lancong and SPS Orang Asal

The 2022 Budget also clearly shows the Government's concern in protecting its own workers and the informal sector. Thus, the Government through SOCSO will implement the Full Grant Program or Self -Employment Social Security Scheme (SKSPS) Contribution Matching Program to continue efforts to expand social protection coverage under SOCSO. The expansion through this initiative is expected to benefit more than 810,000 employees including artists, fishermen and travel agents with a contribution value benefit of up to 80 per cent. Starting in 2022, the SPS Lindung program will be rebranded and broken down into nine (9) categories of Self -Employed Persons (OBS) covered, namely SPS Khidmat, SPS Gig, SPS Usahawanita, SPS Tani, SPS Jaja, SPS Seni, SPS Lain Upaya, SPS Lancong and SPS Orang Asal.

Impact SOSCO budget during pandemic

In an effort to realize the Government's intention to ensure the provision of 600,000 job opportunities in 2022, a total of RM2 billion has been allocated to SOCSO to implement the Employment Guarantee - Employment Incentive (JKIP) under our Employment Insurance System. The Employment Insurance System or SIP for short is one of SOCSO's products that aims to help workers who have lost their jobs to get financial assistance and new jobs. We are targeting 300,000 jobseekers nationwide to receive the benefits of this recruitment assistance. The implementation of these incentives will stimulate more job creation by employers, as well as encourage the participation of more focus groups such as people with disabilities (PWDs), prisoners, ex -servicemen and indigenous people as well as women to return to work. These incentives are also expected to create more sustainable employment opportunities through the extended incentive period.

Through JKIP, employers who employ individuals who are not actively working will receive an incentive of 20 percent of the monthly salary for the first six (6) months and 30 percent for the next 6 months subject to employment with a salary of RM1,500 and above. For the vulnerable, employers are eligible to receive an incentive of 30 percent for the first 6 months, before being increased to 40 percent for the next 6 months, subject to employment with a salary of between RM1,200 to RM10,000. The same incentive rate will also be extended for the recruitment of women who have been unemployed for more than a year, single mothers and housewives.

As a continuation of the success of the previous Apprenticeship program, JKIP will continue to provide incentives of RM900 per month for a period of 6 months to employers who employ school leavers and graduates aged 18 to 30 years. This involves an increase in incentives of RM100 per month from RM800 previously in the 2021 Budget. Starting in 2022 as well, the program will be rebranded as SIP Apprenticeship. Along with the development of the gig economy, JKIP also provides an incentive of RM900 per month for 6 months to individuals involved in gig work. These incentives will continue to benefit vulnerable groups and individuals experiencing job loss to engage in gig employment so that they can obtain full -time employment. Beginning in 2022, the program will be rebranded as SIP Gig to replace the KerjayaGig Program name. 

To provide social protection to housewives and widows through the EPF and Social Security Organisation (Socso), Tengku Zafrul(2021) said the government has provided RM80 million under the Kasih Suri Keluarga Malaysia Programme where they will gain the benefits until the age of 55,This year, he said the government had expanded the coverage of national social protection under SOSCO to also contribute to its own employees and the informal sector. For next year, this initiative will be continued with a contribution value of 80 per cent and its benefits will be extended to nine new categories of the self-employed which include farmers, fishermen, hawkers, artists, travel agents and community rehabilitation workers.

This initiative is expected to benefit more than 810,000 self-employed people, adding that Putrajaya would also continue the Job Search Allowance to both SOCSO contributors and non-contributors. To further encourage private employees to contribute to SOCSO and protect those who lost their jobs, the tax relief limit is increased from RM250 to RM350 and the scope of relief for SOCSO contributions will also be expanded to cover employee contributions through the Employment Insurance System(Chief Executive SOSCO 2021).

For retirees, the government planned on increasing the minimum pension rate under the Disability Scheme (Skim Keilatan) from RM475 to RM550 which would benefit 56,000 households. This initiative, he said, is entailed by an adjustment of SOSCO benefits to the cost of living which is expected to benefit over 400,000 existing recipients. It would also involve additional Socso b

OBJECTIVE OF BUDGET

 

1. Reallocation of Resources

Through budgetary policy, the government wants to reallocate resources according to economic and social priorities. This distribution to maximize national profits and public welfare can be preserved. It is actually to enable the nation money to be channeled according to sector priorities, so that a balanced national development can be achieved. As an example of the welfare scheme launched is Dasar Bantuan Keluarga Malaysia which was announced by the Minister of Finance in the presentation of the 2022 budget where the expenditure is RM 8.2 billion and it focuses on the B40 group involving 9.6 million recipients. Among the essence is the eligibility for recipients of the Social Welfare Department (JKM) was also increased to RM1169 from RM980 to qualify them to apply for assistance from JKM.

 

Government use term "KELUARGA MALAYSIA" as their tagline to rebuild our nation

2. Reducing in equalities in income

The government through the launched budget wants the gap between rich and poor not to be so far. It can be seen by imposing or increasing taxes on the rich as well as providing welfare schemes to the poor. For example, the government imposes income tax on certain groups where the higher the income of the people the higher the tax he has to pay. It also involves private companies where tax collection, stamp duty, levies and excies duties are imposed on them by the government. For example, the Bumiputera Youth Contractor Participation policy was announced in the 2022 budget where the objective was to create a program accelerator by CIDB (RM10 j). Provision of small -scale Government procurement projects to Bumiputera contractors that involves 10 millions. This allows more opportunities to be given to Bumiputera in order to reducing in equalities in income  with other races that monopoly certain sector.

3. Ecomomic stability

The budget that has to be launched must also focus on the national economic stability. It is very important to country development. Convincing investors and attracting new investors to continue investing in the country is an objective of the national budget. For example, despite facing fiscal challenges due to the COVID-19 epidemic, the Government has prepared four economic stimulus packages namely PERMAI, PEMERKASA, PEMERKASA+ and PEMULIH in 2021 comprising fiscal and non-fiscal measures amounting to RM225 billion or 14.8% of GDP to further increase the economic competitiveness of the country. This policy actually gives an injection of confidence to investors to continue investing in this country.

If economic unstable, some the others are affected !!!

4. Employment generation.

Through the 2022 budget that has been announced by the government, the emphasis on employment opportunities is also focused. Employment opportunities exist through government spending on various government mega projects such as railways, bridges, skyscrapers and many more that involve skilled and unskilled labor. Apart from that, the government also provides various incentives to its people to create employment opportunities for the young generation. For example, the Jamin Kerja Keluarga Malaysia (JaminKerja) policy was introduced by the government which provided 600,000 job opportunities with RM4.8 billion spent. Among the incentives available under this policy is the Malaysia Short -term Employment Program (MySTEP) to offer 80,000 job placements, with 50,000 within the public sector and 30,000 in Government -Linked Companies (GLCs). The implementation of the JaminKerja initiative is a step towards economic recovery as well as helping to reduce the nation unemployment rate to four percent and achieve full employment.

To growth the nation, administrator must be ensure our generation will be employed 

 

INTRODUCTION OF BUDGET

 

         Assalamualaikum and greetings to all. This blog was created to explain about the budget. The budget to be clarified is the 2022 budget which was tabled by the Finance Minister recently in parliament on October 2021. What is the budget??. Budget is the expenditure country planning for next years. A budget is a spending plan, which is a way to balance the money you have with the money you spend. You make a plan by making a choice. You decide what you will spend, how much you will spend and how much you will save.

 

             Your financial plan is based on income and expenses. Income is money that goes into your pocket. Spending, on the other hand, is something that requires you to spend money. Since everyone’s income is different, then your plan needs to fit your position and finances. Your budget is based on Goals, Needs and Wants.

 

             In Malaysia, federal budgets are presented annually by the Government of Malaysia to identify proposed government revenues and spending and forecast economic conditions for the upcoming year, and its fiscal policy for the forward years. The federal budget includes the government's estimates of revenue and spending and may outline new policy initiatives. Federal budgets are usually released in October, before the start of the fiscal year. All of the Malaysian states also present budgets. Since state finances are dependent on money from the federal government, these budgets are usually released after the federal one.

 

            The federal budget is a major state financial plan for the fiscal year, which has the force of law after its approval by the Malaysian parliament and signed into law by the Yang di-Pertuan Agong. Revenue estimates detailed in the budget are raised through the Malaysian taxation system, with government spending representing a sizeable proportion of the overall economy. Besides presenting the government's expected revenues and expenditures, the federal budget is also a political statement of the government's intentions and priorities, and has profound macroeconomic implications. The budget is announced in the Dewan Rakyat (House of Representatives) by the Minister of Finance, who traditionally wears baju Melayu while doing so. The Budget is then voted on by the House. Budgets are a confidence measure, and if the House votes against it the government can fall, although never happened to Prime Minister to date.

 

             The governing party strictly enforces party discipline, usually expelling from the party caucus any government Member of Parliament (MP) who votes against the budget. Opposition parties almost always vote against the budget. Since 2008, the opposition bloc used to prepare a complete alternative budget and present this alternative to the Malaysian people along with the main budget. In cases of minority government, the government has normally had to include major concessions to one of the smaller parties to ensure passage of the budget.

 

             Malaysia follows the conventions of the Westminster system. For example, the prime minister must have the support of a majority in the Dewan Rakyat (House of Representatives), and must in any case be able to ensure the existence of no absolute majority against the government. In relation to the budget, that requires that if the House fails to pass the government's budget, even by one ringgit, then the government must either resign so that a different government can be appointed or seek a parliamentary dissolution so that new general elections may be held to re-confirm or deny the government's mandate.

 

             The process of creating the budget is a complex one which begins within the working ranks for the Federal Government. Each year, the various departments and agencies that make up the Government submit what are called 'The Main Estimates' to The Treasury Board Secretariat. These documents identify the planned expenditure of each department and agency, linking these proposed expenses to programs, to objectives and ultimately to the priorities of the current ruling Government. The Treasury Board Secretariat combines these budget estimates and compile an initial proposed budget. From there, the Cabinet and Prime Minister's Department adjust the budget based on a series of economic, social and political factors. In reality, decisions are usually made with the primary intend of re-election and so often include advantages for key regions and lobby groups.

 

             The government reserves the right to submit "supplementary supply bills", which add additional funding above and beyond what was originally appropriated at the beginning of the fiscal year. Supplementary supply bills can be used for things like disaster relief and to update its agencies' spending totals for the current financial year and report any governmental re-organisations.

 

Classification of revenue

The Federal Government’s revenue is classified into four general categories, namely tax revenue, non-tax revenue, non-revenue receipts and revenue from the Federal Territories.

Tax revenue

Tax revenue is classified into direct tax revenue and indirect tax revenue.

Direct tax revenue includes revenue from:

·     income tax and supplementary income tax (individual, company, petroleum, withholding and cooperatives;

·       estate duty;

·       stamp duty;

·       real property gains tax (RPGT);

·       Labuan offshore business activity tax; and

·       miscellaneous direct taxes.

 

Indirect tax revenue includes revenue from:

·       Goods and Services Tax (GST);

·       export duties;

·       import duties;

·       excise duties;

·       levies; and

·       miscellaneous indirect taxes.

Non-tax revenue

Non-tax revenue consists of:

·    licences, registration fees and permits: inclusive of all charges imposed on the granting of rights to individuals, corporations, businesses including petroleum royalty, and other enterprises as well as motor vehicle licences for purpose of regulation or control and levy on foreign workers;

·    service fees: inclusive of receipts from services rendered by the Federal Government to the public;

·       proceeds from sales of goods: inclusive of receipts from the sales of physical assets owned by the Government including lands, buildings, office equipments, storage facilities and the sale of miscellaneous goods to the public;

·       rentals: inclusive of rentals from land, buildings, vehicles and machineries;

·   interests and proceeds from investments: inclusive of proceeds from sale of investments, dividends earned from bonds or shares (PETRONAS dividend, Bank Negara dividend, Khazanah dividend), bank interests and interests on loans granted by the Government;

·       fines and penalties: inclusive of out-of-court settlement fees as well as fines and forfeitures;

·       contributions and compensations received from home and abroad;

·    income from exploration of oil and gas: income from petroleum operation Malaysia-Thailand Joint Authority (MTJA); and

·       other non-tax revenue.

 

List of Authors

 

1. ABDUL QAIYUM BIN MHD NORAWI 

2. MOHD ILMIDDIN BIN CHE AWANG 

3. AHMAD SHAFIE BIN TAIB

4. NOR FARIZA BINTI MARZUKI