KUALA LUMPUR (Reuters) - Malaysia’s Prime Minister Najib Razak presents the government’s 2018 budget on Oct. 27. Below are some items that it could feature, according to analysts’ research notes and Malaysian media reports.
OCBC Bank expects another year of cash handouts, estimating that the allocation will rise to 7.5 billion ringgit ($1.78 billion) from the 6.8 billion ringgit spent in 2017.
The government may consider expanding the scope of the goods and services tax, which was introduced at 6 percent in April 2015, to cover e-commerce transactions, according to a note by UOB.
Middle income earners could get tax breaks as Najib looks to soften the blow from rising living costs, according to Nomura economist Brian Tan. The last time the government announced tax cuts was 2014.
Najib has said that civil servants can expect “good news” in the 2018 budget. Salaries were last raised between 7 and 13 percent in 2012, and in July 2016 the minimum wage was raised from 832 ringgit to 1,200 ringgit, according to data from HSBC.
The government announced in April that minimum wage will be reviewed for a possible adjustment in 2018. The current rate is 1,000 ringgit in the peninsula and 920 ringgit in Sabah and Sarawak.
The government is expected to raise its allocation to develop affordable housing for 2018. In this year’s budget, 700 million ringgit was allocated to build affordable options such as Rent-To-Own schemes offering properties for as low as 35,000 ringgit to low-income earners.
($1 = 4.2240 ringgit)
Reporting by Joseph Sipalan; Editing by Richard Borsuk