Business highlights of Budget 2016 proposals: Wealthy to pay more taxes, tax relief for individuals, tax incentives for retail bond and retail Sukuk, affordable homes, minimum wage scheme, infrastructure
Tax relief
Tax relief for individual taxpayers whose spouse do not have income, is increased from RM3,000 to RM4,000
Tax relief limit for every child below 18 yrs, beginning 2016 year of assessment, doubled from RM1,000 to RM2,000
Income tax pushed up to 26% from 25% for those earning between RM600k-RM1mil. Income tax pushed up to 28% from 25% for those earning over RM1mil
Tax relief for children undergoing higher education to be increased from RM6,000 to RM8,000 from 2016
Tax incentives
Tax incentive for issuance of retail bond and retail Sukuk. Double deduction on additionalm issuance costs of retail bonds; double deduction on additional issuance costs of Sukuk from year of assessment 2016 to 2018.
Tax exemption extended for another four years ro promote business management activities of Shariah-compliant funds.
Homes
800 affordable homes to be built by GLC near MRT stations & 4,600 affordable homes by Sime Darby Property
Govt to build 5,000 PR1MA & PPA1M housing units in 10 locations near LRT and monorail stations and corridor
Minimum wage will be raised from RM900 to RM1,000 a month from July 1, 2016 for Peninsular Malaysia while for Sabah and Sarawak, it will be increassed from RM800 to RM920. This will affect all sectors except domestic help.
To assist Bumiputra businesses, RM400mil allocated to EKUINAS, RM250mil to PUNB, RM150mil to Pelaburan Hartanah Bhd.
Malaysia expects to continue to see controlled inflation for next 2-3 years
GST
Govt’s decision to implement GST timely, as oil prices fell over 50%
Global oil prices expected to remain low in 2016, revenue from the commodity expected to be about RM31.7bil
Collection of Sales and Service Taxes only RM18bil compared to GST at RM39bil
Without GST, Malaysia’s deficit would be up at 4.8% & not 3.1% as forecasted
MRT
MRT II Sg Buloh-Serdang-Putrajaya with estimated cost RM28bil expected to commence 2nd quarter 2016, completed in 2022
LRT3 project Bandar Utama, Damansara-Johan Setia, Klang with estimated cost RM10bil to begin 2016, complete in 2020
In 2016, govt targets 30.5 mil tourists, to contribute RM103bil to economy. RM1.2bil allocated to Tourism Ministry
SME
Setting up SME Tech Transformation Fund worth RM200mil, under SME Bank with 4% interest rate
RM267.2bil has been allocated under Budget 2016, compared with RM260.7bil in 2015.
There will be nine high-impact domestic projects worth RM6.7bil in total.
Investments
The first priority of Budget 2016 is to spur domestic investment to contribute 26.7% to the GDP in 2016.
Govt aims to increase private investment to RM218.6bil and public investment to RM112.2mil.
RM100mil as loan to UDA Holdings for development of Kampung Baru in KL
Infrastructure
To improve infrastructure, he said, the Government will continue to logistics including building and improving rail transport network and highways in 2016. These include the highways of Damansara - Shah Alam, Sungai Besi - Ulu Klang, Pulau Indah and Central Spine Road.
To reduce traffic congestion in Kuala Lumpur, RM900mil is provided to implement the Jalan Tun Razak Traffic Dispersal Project through a strategic public and private partnershi
The Government will also study the feasibility of constructing a coastal highway from Masjid Tanah to Klebang and from Klebang to Jambatan Syed Abdul Aziz in Melaka
RM42mil will be provided for the construction of Mukah Airport, Sarawak as well as the upgrading of airports in Kuantan and Kota Bharu
A feasibility study will be undertaken for the extension of the runway in Batu Berendam Airport in Melaka
http://www.thestar.com.my/Business/Business-News/2015/10/23/Slower-GDP-growth-ahead/?style=biz
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