Tengku Zafrul: Malaysia did not hesitate to extend its economic recovery tax position

Last updated on January 17th, 2021 at 10:53 am

KUALA LUMPUR- In the short term, Malaysia did not hesitate to extend its fiscal stance to support counter-cyclical economic recovery packages and RM322.5 billion in the nation’s largest national budget for 2021. Even though it was Malaysia’s largest budget ever, Finance Minister Datuk Seri Tengku Zafrul Abdul Aziz said it was thought about with a simple fiscal consolidation strategy to, among other things, achieve a deficit of less than four percent under the medium-term fiscal structure of the country.

The government is also working to institutionalize fiscal prudence, governance and accountability on the basis of global best practices under the Fiscal Responsibility Act.’

“The government is also committed to strengthening its revenue base through a multi-prong strategy, beginning with regulating the shadow economy, which is estimated to be roughly 18 per cent of Malaysia’s gross domestic product (GDP) or approximately RM300 billion in 2019,” He referred to the 13th Annual CGS-CIMB Malaysia Virtual Corporate Day 2021 in his speech.

In addition, Tengku Zafrul said that the government is also implementing its medium-term revenue strategy, which, among other things, would reduce the reliance of the country on commodities and further strengthen the leakage reduction tax system.

“However, I assure you that any review will ensure a tax regime that is fair to all, properly timed and takes into account its impact on individuals and businesses.”

The finance minister added that in the coming years, the proper implementation of Malaysia’s large-scale projects would drive socio-economic growth.

“These include those under the 2021 Budget, such as the RM7.4 billion Jendela, the first phase of the national digital infrastructure plan targeting 7.5 million fixed-line broadband gigabit-speed premises, and 96.8 percent 4G mobile coverage with better mobile broadband speed,” he said.

The other infrastructure projects include the Pan-Borneo Highway, Gemas-Johor Bahru Electrified Double Tracking, Klang Valley Double Tracking, Mass Rapid Transit 3, and the Johor Bahru-Singapore Rapid Transit System.