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Friday, August 17, 2012

Boost purchasing power

Publication: NST
Date of publication: Aug 16, 2012
Section heading: Main Section
Page number: 018
Byline / Author: By Irwan Shah Zainal Abidin

ON Sept 28, Prime Minister Datuk Seri Najib Razak will table the budget for 2013, which is his fourth budget since he took the helm in April 2009. The 2010 Budget was his first with the theme 1Malaysia, Together We Prosper, followed by 2011 Budget (Transformation Towards a Developed and High-Income Nation) and 2012 Budget (National Transformation Policy: Welfare for the Rakyat, Well-being of the Nation).

The 2013 Budget, which is Malaysia's short-term development plan, must be seen in the context of Malaysia's five-year economic blueprint - the 10th Malaysia Plan (10MP) - which covers the years from 2011 till 2015. The 10MP incorporates both the way of thinking of the Government Transformation Programme , which outlined the six (now seven) National Key Result Areas and the New Economic Model (NEM). Under 10MP, 12 National Key Economic Areas have been identified and are now being put under the Economic Transformation Programme.

The 10MP, on the other hand, must be viewed in light of the long-term development plan of the National Transformation Policy (NTP), which spans the period from 2011 until 2020 and the fourth National Outline Perspective Plan (NOPP). The NTP, which was announced during the 2012 Budget, will supersede the National Vision Policy, which began in 2001 and ended in 2010, whereas the NOPP will replace the Third Outline Perspective Plan, which covered the period from 2001 to 2010.

Acronyms aside, there are essentially two crucial aims that the past three budgets were trying to achieve, that is, to manage the increasing cost of living and to transform the economy to become a developed and high-income country in 2020. Therefore, I would expect strategies, programmes, and initiatives crafted in the 2013 Budget to again be directed towards achieving these two aims.

As for the aim of managing the soaring cost of living, it is important that the strategies and programmes formulated for this coming budget be less of a temporary, quick-fix and one-off aid basis. Instead, the government should find ways to increase the purchasing power of the people and stimulate domestic consumption in such a way that can reap the highest multiplier effect in the economy. Examples of these measures are: reducing personal income tax and increasing the real property gains tax.

The other strategy is to create a more competitive environment in the market. The non-competitive market structure, such as monopoly and oligopoly, are still prevalent in certain industries and has caused unnecessary hikes in goods and services. The recent increase of cement prices on Aug 1 by RM1 per bag of 50kg or RM20 per tonne is a case in point, where the cement market has an oligopoly market structure.

By promoting competition in the market, like imposing regulations and doing away with protectionist measures, firms are forced to compete, and this would eventually increase the level of productivity and efficiency. As a result, not only would prices go down, but wage rates would go up.

With regard to the second aim, that is, in an effort to transform the economy to become a developed and high-income country, first of all, a very fundamental question needs to be asked: is becoming a high-income economy equivalent to transforming the economy? Well, it may be, but it certainly is not identical. This is just a transitional process and not exactly transforming the economy.

Transforming the economy must mean that the following issues are being addressed convincingly: money politics, corruption, cronyism, nepotism, favouri-tism, leakages, abuse of power, market inefficiency and unequal distribution of wealth.

To transform the economy, it requires more than just achieving the numbers and statistics targeted.

Therefore, measures and strategies on structural and institutional reforms are needed in the 2013 Budget to really transform the economy. Towards this end, it is timely for the government to reconsider again the setting up of the Equal Opportunities Commission that was proposed in the New Economic Model Part I blueprint. This commission can promote inclusiveness in the economy, eventually enhancing Malaysia's global competitiveness.

In addition, the 2013 Budget needs to further detail the six strategic reform initiatives introduced with a specific objective of enhancing Malaysia's competitiveness level. Besides this, other initiatives need to be introduced such as strengthening the regulatory framework, advocating transparency and accountability, introducing an open tender system, reducing barriers of market entry and democratising the access of information.

The other issue is about tax reforms. The 2013 Budget cannot be silent when it comes to the Goods and Services Tax (GST), a broad-based tax system which can enhance government revenue in future.

I am not expecting the government to introduce the GST next year, but the government should at least give a clear time-frame on when it is going to be put in place to substitute the current Sales and Services Tax (or SST) system.

In transforming the economy to become a developed and high-income country, the 2013 Budget must reflect the spirit and aspirations of Vision 2020, as outlined by former prime minister Tun Dr Mahathir Mohamad in February 1992, which is to make Malaysia a united nation, with a confident Malaysian society, infused by strong moral and ethical values, living in a society that is democratic, liberal and tolerant, caring, economically just and equitable, progressive and prosperous, and in full possession of an economy that is competitive, dynamic, robust and resilient.

In analysing the budget, it is impossible to detach its relationship with the timing of the 13th general election which must be called before April next year.

Therefore, I would predict the budget to be an election budget, but hope that the measures will be less populist.

Irwan Shah Zainal Abidin,

Universiti Utara Malaysia, Sintok,


Monday, August 13, 2012

GST beri kesan positif kepada ekonomi negara

AUGUST 13, 2012
KUALA LUMPUR, 13 Ogos — Pengenalan skim cukai barangan dan perkhidmatan (GST) atau VAT (cukai nilai tambah) sebenarnya mampu memberikan kesan positif kepada ekonomi negara, lapor akhbar Utusan Malaysia hari ini.
Akhbar harian itu melaporkan melalui pengenalan cukai tersebut, ia mampu untuk menarik kehadiran pelancong ke Malaysia kerana seperti mana 146 negara lain di seluruh dunia yang memperkenalkan cukai ini, mereka telah menawarkan skim pemulangan cukai kepada pelancong yang membeli-belah di negara mereka
“Negara-negara itu telah memperkenalkan GST dan VAT yang mana melalui skim itu, setiap pelancong mendapat keistimewaan bayaran balik cukai bagi barangan yang dibeli,” lapor akhbar berkenaan.
- Gambar fail
sebelum ini dilaporkan berkata, “seperti mana-mana negara lain yang telah melaksanakannya, Malaysia juga akan memperkenalkan skim bayaran balik pelancong yang mana mereka boleh menuntut kembali GST yang dibayar ke atas pembelian barangan.”
Melalui cara itu, Najib turut menjelaskan GST dijangka akan dapat memberikan kesan positif kepada pertumbuhan negara, terutama ke atas sektor eksport dan pelancongan.
Malaysia bagaimanapun setakat ini masih lagi belum melaksanakan GST atau VAT dan ianya masih lagi dalam perbahasan di Dewan Rakyat.

GST mampu jadi tarikan pelancong

ARKIB : 13/08/2012

AMBANG Aidilfitri semakin menjelma. Umat Islam di seluruh dunia kini sibuk melakukan persiapan untuk menyambut hari istimewa di samping tidak ketinggalan meningkatkan amalan di akhir-akhir bulan Ramadan.

Apa yang menarik, setiap kali munculnya Syawal, aktiviti berkaitan pelancongan juga akan meningkat kerana ramai daripada kita yang akan memanfaatkan cuti panjang sempena hari raya.

Hotel-hotel kebiasaannya akan penuh ketika itu kerana ramai yang akan melancong bersama keluarga, sama ada di dalam atau ke luar negara.

Menyentuh mengenai pelancongan, terutamanya di luar negara, tahukah anda kebanyakan negara-negara di seluruh dunia telah menawarkan skim pemulangan cukai kepada pelancong yang membeli-belah di negara mereka.

Bagaimana mereka melakukannya? Jawapannya mudah sahaja iaitu negara-negara itu telah memperkenalkan skim cukai barangan dan perkhidmatan (GST) atau VST (cukai nilai tambah) yang mana melalui skim itu, setiap pelancong mendapat keistimewaan bayaran balik cukai bagi barangan yang dibeli.

Menarik bukan? Perkara ini diakui sendiri oleh Perdana Menteri Datuk Seri Najib Tun Razak yang menyatakan GST dijangka dapat memberi kesan positif kepada pertumbuhan negara, terutama ke atas eksport dan sektor pelancongan.

Najib dilaporkan berkata, seperti mana-mana negara lain yang telah melaksanakannya, Malaysia juga akan memperkenalkan skim bayaran balik pelancong yang mana mereka boleh menuntut kembali GST yang dibayar ke atas pembelian barangan.

"Langkah ini akan turut menarik mereka membeli barangan bebas cukai di Labuan, Langkawi dan Tioman yang statusnya sebagai pulau bebas cukai akan dikekalkan," kata beliau.

Bagaimanapun setakat ini, Malaysia masih belum melaksanakan GST atau VAT dan kita hanya dapat melihat bagaimana ia berfungsi apabila melancong ke negara-negara yang telah melaksanakannya.

Menuntut pemulangan cukai

Sebenarnya, ramai juga daripada kita masih tidak mengetahui mengenai kelebihan yang ditawarkan sebagai pelancong ketika membeli-belah di negara yang telah melaksanakan GST/VAD.

Sebagai contoh, setiap tahun, pelancong yang melawat negara-negara Eropah telah meninggalkan berjuta-juta dolar cukai yang tidak dituntut selepas membeli barangan di negara-negara yang melaksanakan GST/VAT itu.

Sebenarnya sebagai pelancong, apabila berada di lapangan terbang atau sempadan ketika hendak keluar dari negara itu, kita boleh menuntut kembali cukai GST/VAT yang dibayar ketika membeli barangan tertentu.

Terdapat prosedur mudah yang perlu diikuti untuk menuntut cukai yang telah dibayar itu.

1. Bawa pasport - Sebaik-baiknya bawa pasport ketika berjalan di negara orang, terutama jika anda ingin mendapatkan pulangan cukai dari barangan yang dibeli.

2. Beli barang di kedai-kedai yang mengambil bahagian - Kebiasaannya peruncit boleh memilih untuk menyertai skim pemulangan GST/VAT dan ia dipaparkan di kedai mereka. Bagaimanapun, adalah lebih baik mendapatkan kepastian dengan bertanya dahulu sebelum membeli.

3. Lengkapkan dokumen - Sebaik sahaja membeli, pastikan pekedai mengisi dokumen pemulangan cukai dikenali sebagai 'cek' dengan lengkap dan kemudian kepilkan bersama resit dan simpan.

Bagi kedai yang mempunyai pelekat 'Rangkaian Beli-belah Bebas Cukai', ia akan lebih mudah kerana pekedai boleh menghantar dokumen bagi pihak anda dan seterusnya wang pemulangan cukai dimasukkan terus ke akaun kad kredit anda.

4. Bawa dokumen, resit dan barangan yang belum digunakan bersama apabila hendak keluar dari negara itu.

5. Copkan dokumen anda di pejabat kastam di lapangan terbang dan pastikan bawa barangan yang dibeli. Sebaik-baiknya jangan pakai dahulu pakaian atau kasut baru anda itu.

6. Menuntut wang - Anda hanya perlu mencari perkhidmatan bayaran balik seperti pejabat Blue Global atau Premier Bebas Cukai (EU) di lapangan terbang atau sempadan.

Selepas menyemak dokumen, mereka boleh memberikan anda bayaran balik secara tunai atau mengkreditkan bayaran balik ke kad kredit anda dalam tempoh bil yang seterusnya.

Jika anda tidak dapat mencari perkhidmatan seperti di atas, ini bermakna kedai yang anda beli barangan mengendalikan bayaran balik VAT/GST secara langsung dan anda perlu menghantar dokumen dari lapangan terbang atau sempadan melalui sampul surat yang disetemkan kepada alamat dibekalkan oleh pekedai.

Kemudian, wang itu akan dikreditkan ke kad kredit anda.

GST atau VAT merupakan salah satu daripada pelbagai jenis cukai yang diperkenalkan di sesebuah negara. Ia telah diperkenalkan di lebih 140 negara dan negara kita juga tidak ketinggalan akan memperkenalkannya tidak lama lagi.

Apabila diperkenalkan kelak, GST akan menggantikan skim cukai perkhidmatan dan cukai jualan yang dilaksanakan masa kini.

Jika kadar GST ialah 4 peratus atau 5 peratus, sudah tentu ia jauh lebih rendah daripada kadar cukai jualan 10 peratus dan cukai perkhidmatan 6 peratus yang dikenakan sekarang.

Apabila diperkenalkan kelak, sudah tentu ia akan memberi manfaat kepada kita dan juga para pelancong yang boleh mendapat rebat GST apabila berbelanja di negara ini.

Bersambung Selasa depan.

© Utusan Melayu (M) Bhd

Sunday, August 12, 2012

Fitch sees pressure on Malaysia’s credit profile from public finances

Thursday, 09 August 2012 14:03
Anuja Ravendran

Malaysia will have to reduce its heavy dependence on petroleum-linked revenue and implement the Goods and Services Tax (GST) due to concerns on weakening public finances, a global sovereign credit rating agency said.

There are growing strains on the country’s credit profile, Fitch Ratings said yesterday. “Fitch Ratings is concerned that negative pressures may build and eventually offset the existing strengths of the sovereign credit profile unless structural weaknesses in the public finances are addressed,” it said in a special report on ”Malaysian Public Finance”.

However, it said efforts to address the underlying structural weaknesses within Malaysia’s public finances will be limited until after the general election as policymakers’ foremost concern lies in winning favour with the electorate, especially after the ruling coalition Barisan Nasional lost four states in the 2008 elections.

On Malaysia’s fiscal deficit pattern, Fitch said that despite having narrowed its deficit in 2011 to 4.8% of gross domestic product (GDP), the gains were offset by a higher personnel expenditure and “higher-than-expected” subsidy due to high global oil prices.

It added that the 2012 budget faces headwinds from global developments and the unrevised original deficit target of 4.7% of GDP for 2012 may be difficult to achieve if the world economy worsens.

It said that Malaysia’s public finances fare poorly when compared to both ‘A’ and ‘BBB’ range medians, and in some cases are comparable to more heavily-indebted sovereigns.

Fitch had previously stated that measures to enhance the overall revenue base and reduce Malaysia’s energy dependence would be positive for the current ratings.

“One measure the government has long discussed is the GST. Its implementation has been delayed on a number of occasions. Without it, Malaysia has been unable to arrest the structural decline in non-oil revenues since the Asian financial crisis of the late 1990s,” it said.

It noted that Malaysia’s revenue base is narrowed and overreliance on oil-linked revenues “does not help”.

Despite its earnings potential from high oil prices, a combination of strong domestic energy demand, supported by extensive subsidies, and limited investment in the oil and gas sector over the last decade suggest the net benefits accrued are becoming smaller, it said.

This exposes the country to greater volatility in earnings, it said. Fitch also raised concern on the country’s closeness to its debt ceiling.

“Despite strong GDP growth in 2010 and 2011, the continued rise in the federal government debt/GDP ratio to close to the existing debt ceiling of 55% suggests there is limited room for fiscal slippage under the current framework,” it said.

It added that Malaysia’s debt dynamics are unfavourable and based on Fitch’s current base case scenario, federal government debt will continue to rise.

“Malaysia’s extreme level of trade openness (exports are equivalent to 90% of GDP) and existing high public debt stock leave it exposed to a further sharp increase in public debt ratios in the event of an interest-rate and/or growth shock, as happened in 2009,” it said.