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Thursday, October 31, 2013

JTI: No major surprises in Budget 2014

Published: Monday October 28, 2013 MYT 12:00:00 AM 
Updated: Monday October 28, 2013 MYT 7:13:20 AM

Rob Stanworth
Managing Director
JT International Bhd

There were no major surprises for us in Budget 2014 and as expected the Government focused on addressing the fiscal position.

Overall, a fair budget but whether it will be truly transformational will depend on the rigour and commitment with which the intended measures are implemented.

The biggest announcement was on GST and we welcome the clarity the government has provided on the timing of its implementation.

The reduction in both personal and corporate taxes in 2015 may go some way towards softening the impact on the consumer.

Although exports are expected to grow 2.5% in 2014, there were no specific measures announced to assist themanufacturing sector.

Further liberalisation and reduction of bureaucracy would certainly help export-orientatedcompanies like JTI to expand.

To achieve the Government’s target toincrease its revenue by RM4bil in 2014 and reduce its fiscal deficit, we believe that gains can be made from a strengthened Government-led initiative to tackle the illegal cigarette trade problem which represents close to RM2bil in tax losses annually.

The increased budget allocation for border control and securityoffers an excellent opportunity to address illicit trade and improve enforcement against smuggling.

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