Budget 2016’s allocations are made with the objective of helping the low and middle income groups cope with their financial burdens and also to complement tax reliefs, said a tax consultant.
Many middle income earners feel that they are getting no perks from the latest Budget, with them having the least benefits.
Consultant Koong Lin Loong, who is also a Finance Ministry Goods and Services Tax working committee member, disagrees with such views, urging the people not to have a “microscopic” view of Budget 2016.
“Many people misunderstand (the Government’s efforts). In order to have the full picture, a budget cannot be read a year by itself. It has to be studied as a continuation of past budgets,” he added.
Last year’s Budget announcement’s (Budget 2015) offer of 105% financing and waiver of stamp duty for first-time homebuyers of the 1Malaysia People’s Housing Programme are still applicable in 2016.
“These benefits can still be enjoyed next year,” he said.
Koong, who has been an auditor and tax consultant the past two decades, is a national council member of Malaysia’s Institute of Taxation.
Other perks include the tax relief for each child below 18 has been increased by 100% for 2016, up from RM1,000 to RM2,000.
“The previous adjustment was in 2004 ,” he said.
The personal income tax cut by 1% to 3% announced last year would still applicable next year, Koong reminded.
Together with other tax reliefs announced this year, the M40 group – those earning between RM3,860 and RM8,319 – would see a reduction of RM500 to RM600 in tax payable, he added.
“The middle income group does not receive BR1M but this is a kind of ‘indirect BR1M’.
“To me it is free money which increases their disposable income,” he said, referring to the government scheme to ease the burden of the low income group.
MCA deputy president Datuk Seri Dr Wee Ka Siong also sees that Budget 2016 is aimed at “lifting the financial pressure” off the middle income group.
“In MCA’s proposal to the Cabinet, our first highlight was about giving more tax relief to this group.”
“Our Prime Minister and Finance Minister Datuk Seri Najib Tun Razak has heeded our recommendations,” he said during his opening speech at the Malaysian Economic Outlook seminar on Sunday.
Stretch your Ringgit further by using the right credit card for your lifestyle.
[Source]
