Perks abound for B40 but review Budget 2021 in three months, says economist Ramon Navaratnam

Budget 2021 offers plenty of perks especially to those in the lower income group.

While it seems to cover a wide range of segments and industries, economist Tan Sri Dr Ramon Navaratnam suggested a supplementary budget be tabled in three months.

“This budget seems very optimistic as the government speaks about recovery and growth,” said the Asian Strategy and Leadership Institute’s (Asli) Centre for Public Policy Studies chairman.

“But if the recovery and growth cannot be met, what is the contingency plan? Thus we must review Budget 2021 in the next three months and have a supplementary budget, that too depending on how Covid-19 plays out.

“This budget has to be reviewed … to see if it’s sustainable and if adjustments are required. If Covid-19 is not settled in the next three months, we will be in trouble,” said Navaratnam, who once served as the deputy secretary-general of the Treasury.

Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz, during the tabling of Budget 2021 in Parliament this evening, said Malaysia’s economy is expected to recover and expand at a rate between 6.5 per cent and 7.5 per cent.

This, he said, was in line with the proactive measures undertaken by the government through the economic stimulus packages, initiatives under Budget 2021 and supported by the recovery of the global economy, which is forecast to rebound by 5.2 per cent.

Right after the budget was tabled, the Health Ministry revealed there were 1,755 new Covid-19 cases today – a record high – bringing the total number of cases to 38,189.

While the B40 seem to enjoy plenty of incentives to help them through the tough times, Navaratnam said: “How do we generate growth in order to sustain these large giveaways? The sustainability of the Budget is a question to ask.”

He pondered why the rich were not being taxed.

“The government could have introduced some taxation for the rich … for example estate duties, property tax, wealth tax and windfall tax.

“This is why you have trouble worldwide. One per cent owns 50 per cent of the wealth and at a time of crisis, people are dying and these (rich) fellows live it up.”

He also questioned why race-based allocations were made in Budget 2021.

Some RM11.1 billion will be allocated towards efforts to support the bumiputra development agenda in 2021. Also, one-off special payment of RM500 will be given to Muslim clergies.

For the Chinese community, RM177 million will be provided for programmes to improve educational facilities, housing and the development of new villages, as well as financing facilities through Bank Simpanan Nasional. For the Indian community, RM100 million is allocated to the Malaysian Indian Transfomation Unit to elevate the socio-economic status of the community.

“Separate allocations were made for the Chinese and Indians. That’s not healthy in promoting national unity. I think we have passed that age. The poor are the poor. The ones who are miserable regardless of race should be helped.”

“There are allowances for the Imam. What about Buddhist, Hindu and Christian priests. This again will cause disunity.”

Budget 2021 also sees allocations to encourage a healthy lifestyle as RM19 million has been aside to implement the Malaysia National Healthy Agenda. RM28 million is also provided to implement the MyFit Programme, National Sports Day and Inspire Programme for the disabled community.

In addition, the tax relief limit for lifestyle has been increased from RM2,500 to RM3,000 where the additional RM500 is specifically provided for expenditure related to sports, including participating fee for sports competitions. The scope of the relief is also expanded to include subscription of electronic newspapers.

Prime Minister Tan Sri Muhyiddin Yassin said Budget 2021 was to protect Malaysians and businesses and help them to rebound and secure their future in these trying times.

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