Did The Rakyat Get What They Want?
The 2021 budget was tabled today.
This year’s budget is eagerly awaited – many of us were hoping for more government support to help us weather this economic recession. Last month we asked you what you want in the 2021 budget. Almost 300 of you voted on the measures you would like to see, and 48 of you wrote to let us know your points. view and suggestions.
So how does the actual budget compare to our hopes and expectations?
This is what we have
Cost of life
One of the goals of the 2021 budget is to protect the welfare of the rakyat. Here’s how they responded to your concerns.
Financial aid from Bantuan Sara Hidup (BSH) will be transformed into Bantuan Prihatin Rakyat (BPR). Under the new financial aid program, eligible households will receive up to RM 1,800 in January 2021. Some of you also wrote that you are looking for more initiatives for the elderly and the disabled – the government has heard you and will increase monthly social assistance for these groups as well.
The contribution rate to the Employee Provident Fund (EPF) for workers will be lowered from 11% to 9% for 12 months, starting in January 2021. For those who have lost their jobs, they will also be allowed to withdraw until ‘at RM500 per month for 12 months. month, from January 2021.
It was the most voted measure, with 91% of you agreeing that there should be a cut. You’ll be happy to know that there will be a 1% reduction in the personal income tax rate – but only for those in the taxable income bracket of RM50,001 and RM70,000.
There will be more credit on the e-wallet this year, but only for 18-20 year olds.
Thanks to the pandemic, the unemployment rate soared to 5% in April, the highest in 30 years. Some of you have written to say that you want the government to focus on creating jobs next year. Here is what the government is doing to help employees.
The wage subsidy program, which provided wage subsidies to employers, helped reduce the unemployment rate and benefited approximately 2.7 million employees. For the 2021 budget, the government has announced that it will extend the program for another three months, but that it will target more workers in the tourism and retail sector.
For 2021, the government has allocated RM 1 billion for various upgrading and re-qualification programs. This should benefit 200,000 people.
The Department of Education has estimated the unemployment rate for new graduates this year will be 25%, in part thanks to the COVID-19 pandemic. In response, the government grants a bonus of RM 1,000 per month (up to three months) to private employers for graduates who participate in apprenticeship programs. In addition, RM 150 million will be allocated for professional certification from the Ministry of Higher Education, with new graduates each being eligible for a RM 3,000 voucher to take a professional certification course.
Our income has not kept up with the increases in house prices over the past few years. The current economic recession is not helping our ability to pay for our first homes. How does the government plan to help?
The government has announced full stamp duty relief for first-time home buyers. This exemption applies to sales and purchase contracts signed from January 1, 2021 to December 31, 2025. There will also be a stamp duty exemption on loan agreements and transfers of ownership for certified abandoned housing projects. during the same period.
Other measures have also been taken to promote home ownership among first-time buyers. This included an allocation of RM 1.2 billion for housing construction, especially for low income groups. The government will also work with financial institutions to set up a hire-purchase program involving PRIMA homes, which will run until 2022.
And what we didn’t get
One popular measure you voted for was an increase in the minimum wage. The previous 2020 budget increased this amount from RM 1,100 to RM 1,200 in major cities. Later, the minimum wage was also increased in other parts of the country, from RM 1,050 to RM 1,100. Although the government has proposed several initiatives to create jobs and improve the skills of workers, no increase in the minimum wage has been announced.
A survey by Juwai IQI Holdings, a real estate sales and media firm, found that the 2021 budget measures most sought after by the real estate industry included a stamp duty exemption, increased support for first-time buyers house and a reduction in the Real Estate Gains Tax (RPGT). . Although this year’s budget delivered the first two measures, there was no mention of a reduction in the RPGT. However, earlier this year an PGRT exemption for up to three residential properties was already announced – it takes effect until December 31, 2021.
Finally, a metric you might be glad you didn’t see. Last month, the Center for Socio-Economic Research (SERC) said the government may announce the return of the goods and services tax (GST) in the 2021 budget. It also noted that when the economy shifts is restored, the “only way to avoid the debt pile is to consolidate and reduce budget deficits by increasing tax revenues or reducing public spending.” About 40 p. 100 of you said you would like to see a reintroduction of the GST, but this controversial tax was not discussed this year.
Did you get what you wanted?
This year’s budget has certainly given us some hope. Financial aid programs, increased social assistance and access to our EPF savings can provide immediate relief, while measures to create jobs can help us in the long run. Tell us what you thought of the budget and if the government missed any key measures that should have been tabled.
Our sincere thanks to