More Cash Handouts, Prosperity Tax, And Other Budget 2022 Highlights
Earlier this afternoon, our finance minister Tengku Datuk Seri Zafrul Tengku Abdul finished presenting Budget 2022 in the parliamentary session.
As expected, Budget 2022 continues the good work done in Budget 2021 in helping our economy recover from the effects of the Covid-19 pandemic, while also ensuring that Malaysians who are adversely affected by the pandemic is getting the support they need in to recover from the effects of the pandemic.
With RM332.1 billion allocated, Budget 2022 is the biggest budget announced so far. It was drawn up on three main tenets, Rakyat’s Wellbeing, Business Continuity and Economic Resilience.
Education gets bulk of the budget
As with the prior budget, education is still getting the largest slice of the pie from Budget 2022, with RM52.6 billion allocated for the Ministry of Education (MOE), and RM14.5 million allocated for the Ministry of Higher Education (MOHE).
From the RM52.6 billion that is allocated for MOE, RM1 billion will be allocated for renovation and repairs of schools under MOE, and an additional RM746 million will be allocated for the upgrading of impoverished schools all over the country.
Understanding the need for parents to start preparing their children for the inevitable reopening of schools, the Finance Minister also announced that in Budget 2022, parents will be receiving a one-off payment of RM150 to help them get the necessary supplies for their children.
Malaysian teachers will also be pleased to know that they will be getting a windfall in the form of a one-off payment RM100, under the Special Teaching Aid and Materials Initiative.
Meanwhile, Budget 2022 also announced that RM450 million will be allocated to a new initiative called PerantiSiswa, to ensure that every university student from B40 families will be given a tablet for their learning needs.
Budget 2022; A huge step against unemployment
One of the biggest repercussions of the Covid-19 pandemic is unemployment, which is why Budget 2022 is expected to at least present a solution in that regard.
The Finance Minister did not disappoint as he announced that under Budget 2022, RM4.8 billion is allocated under the JaminKerja scheme, which aims at creating 600,000 jobs and reducing unemployment rates to 4.0%, as it is at 4.6% right now.
Under the JaminKerja scheme, there will also be salary incentives for companies through the Social Security Organisation (SOCSO), which aims to provide salary assistance for 300,000 workers.
The JaminKerja scheme also provides a huge win for focus groups such as the OKU, Orang Asli, and ex-convicts as the salary incentive scheme will also be provided for companies who hire people from these focus groups.
In their efforts to eradicate unemployment, the government also allocated RM1.1 billion for training and upskilling programmes, targeting around 200,000 participants.
Women empowerment movement; huge winner of Budget 2022
The fight for women empowerment can be a long and arduous journey, which is why it’s such a breath of fresh air to see that this time, Budget 2022 is announcing initiatives to help women gain employment, in all rungs of the corporate ladder.
To promote women returning to the workforce, the salary incentive under the JaminKerja will also be extended to companies who hire women who have been out of work for at least 365 days, single mothers, and also housewives.
The Ministry of Finance (MoF) also announced that through the Securities Commission, every public-listed company will be required to appoint at least one woman to their board of directors.
Another RM5 million is allocated to the Women Leadership Foundation, further reaffirming the government’s commitment to the women’s empowerment movement.
Housing and public transportation gets a boost
During his presentation of Budget 2021, Tengku Zafrul also said that the government will be continuing to create more housing projects; particularly ones that aim for the low-income groups to ensure that more people can have a home of their own.
To ensure the continued growth of our public transportation system, MoF also introduced the MyRail5 initiative, which allows for unlimited travel using KTMB services at only RM5. Tengku Zafrul also said that RM80 million will be allocated for public buses operators, and RM115 million for an initiative that will introduce unlimited trips using buses and railways for only RM50 per month, especially for Klang Valley residents.
The government also recognizes the plight of East Malaysians who live in rural areas and had to drive through unpaved roads to get to towns. So, the government will also continue to provide a subsidy amounting to RM209 for air travel.
Expanding the government’s tax base
While everyone is celebrating the goodies they got from Budget 2022, it wouldn’t be right if we didn’t point out some of the losers as well.
And with the government’s effort to expand the tax base in Budget 2022, there were some new taxes that will hit a significant number of Malaysians quite hard.
Two new tax implementations that will hurt a lot of online shoppers out there are the sales tax for low-cost items that are delivered using airplanes from outside the country, and also the service tax for courier services, except for food and logistic services.
Another new tax that is introduced that will surely receive mixed responses is the cukai makmur or prosperity tax, which aims to tax companies that make more than RM100 million in taxable income . While there was talk earlier about the government imposing a windfall tax on these companies who are already paying 24% in corporate tax, the budget announcement specifies a one-off corporate tax of 33% for any company with income over RM100 million.
Through Budget 2022, the government has proved their commitment to helping Malaysians bounce back from the repercussions of the pandemic, while also ensuring that the Malaysian economy will continue to thrive.
For more information on what Budget 2022 offers, you can head over to imoney.my!