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The very first budget under the new Pakatan Harapan's (PH) administration has been unveiled. Let's take a look at some key highlights from the 2019 Budget Speech, themed “A Resurgent Malaysia, A Dynamic Economy, A Prosperous Society” presented by YB Lim Guan Eng, Minister of Finance Malaysia in the Parliament on Friday (Nov 2).
At a glance:
• RM314.5billion allocated for government expenditure in 2019, an increase of 8.3%
• RM259.8billion allocated for operating expenditure while RM54.7billion for development expenditure
• The government expects the GDP to grow 4.9% in 2019
• Actual debt and liabilities as of June 2018 stand at RM1,065billion.
• Households with monthly income of RM2,000 and below to receive RM1,000
• Households with monthly income between RM2,001 to RM3,000 to receive RM750
• Households with monthly income between RM3,001 to RM4,000 to receive RM500
• An estimated 4.1million households to continue receiving financial assistance, totalling RM5billion.
• RM1.5billion on affordable housing via the People's Housing Programme (PPR), Malaysia Civil Servants Housing Programme (PPAM), 1Malaysia People's Housing (PR1MA) and Syarikat Perumahan Nasional Bhd (SPNB).
• To help those with RM2,300 and below monthly income, a RM1billion fund will be set up by Bank Negara for homes up to RM150,000 at an interest rate of 3.5% per annum through selected banks.
• REHDA to offer a reduction of 10% in the price of houses that are not subjected to price control in new projects.
• The government will allow property crowdfunding platforms driven by the private sector as an alternative for first time home buyers and supervised by the Securities Commission, under the peer-to-peer financing framework.
• Public Sector Housing Financing Board to extend the loan repayment period for civil servants from 30 to 35 years for the first loan, and from 25 to 30 years for the second loan.
• All stamp duty charges for unsold properties priced between RM300,001 and RM1million will be waived under the National Home Ownership Campaign for a limited time of 6 months beginning 1 January 2019. Developers will offer a minimum price discount of 10% for these residential properties.
• For first time home buyers for properties up to RM500,000, stamp duty will be exempted up to RM300,000 on S&P agreements as well as loan agreements for a period of two years until December 2020.
• For first time home buyers with a household income of RM5,000 or less, RM25million has been allocated to Cagamas Berhad to provide mortgage guarantees
• Stamp duty for the sale of properties priced more than RM1million will be raised to 4% from 3%
• The LRT3 project continues with a savings of 47% from the initial estimated cost of RM31.6billion to RM16.6billion.
• The MRT2 project continues with a savings of 22.4% from the initial estimated cost of RM39.3billion to RM30.5billion.
• RM60billion MRT3 project deferred till MRT2 is completed.
• No tolls for motorcycles on the First and Second Penang Bridge and the Second Link in Johor starting Jan 1, 2019.
• RM240million allocated to introduce a RM100 unlimited public transport pass for RapidKL rail and bus network. A RM50 monthly pass will be made available for RapidKL bus services.
• RM500million will be allocated to the Public Transport Fund with a 2% interest subsidy for taxi and bus firms and public transport operators.
• RM10million to upgrade the Autogate Malaysia Automated Clearance System and M-Bike.
Real Property Gains Tax (RPGT)
• RPGT will be increased to 10% from 5% previously, for companies, non-citizens and non-permanent residence (PR) holders.
• Citizens and PR holders will see RPGT raised to 5% from zero previously.
• Exempted for land, low-cost housing, medium-cost housing and affordable housing priced under RM200,000.
• Khazanah to develop the 80-acre plot in Subang as a world-standard aerospace hub.
• Government to designate 380 acres of land in Pulau Indah, Selangor as a free trade zone to support and catalyse shipping and logistics activities in Port Klang.
• The RM5.2billion Klang Valley Double Tracking Project will be re-tendered through open tender
• RM1billion for National Fibre Connectivity Plan to develop broadband infrastructure.
• RM2.46billion for upgrading railway tracks.
• RM100million in matching grants to the private sector for running promotional and marketing campaigns overseas.
• Tax-free incentives to Penang's Swettenham Pier in the form of duty-free shops.
• RM500million worth of loan facilities via the SME Tourism Fund.
• RM20million for Malaysia Healthcare Tourism Council (MHTC).
• RM926million allocated to build and upgrade roads and bridges.
• RM694million and RM738million allocations to supply electricity and water respectively.
• MR85million allocated to New Villages for upgrading and maintaining basic infrastructure.
• MR100million allocated to strengthen the development of orang asli communities.
Sabah and Sarawak
• Development expenditure of RM5billion has been allocated to Sabah and RM4.3billion for Sarawak.
• Pan Borneo Highway project continues, subject to a cost-rationalization study.
For full coverage of Budget 2019, go to 2019 BUDGET SPEECH TEXT.