October 16, 2010
The Malaysian Insider’s Budget 2011 Jury. — All pictures by Choo Choy May
KUALA LUMPUR, Oct 16 — Datuk Seri Najib Razak’s second Budget since becoming prime minister was put to the test yesterday, hours after he tabled the Budget 2011 that proposes to spend RM212 billion over the coming year.
Not many were amused by a new six per cent tax slapped on paid television satellite packages.
Some among the 12 were also not impressed by the idea of a 100-storey skyscraper over Stadium Merdeka and Stadium Negara, two independence icons that will remain standing in the RM5 billion Warisan Merdeka project.
Here, in their own words, are the verdict of the 12.
Hussein Maruan, 26, IT Support Manager, British American Tobacco Malaysia
Hussein Maruan said that he was disappointed with the Budget 2011 because it would not benefit the ordinary people, and stressed that it was only a cosmetic budget.
“Well, the budget may sound impressive but when you get to the details — nothing,” he said.
Hussein was very critical with 50 per cent stamp duty exemption for first-time house buyers because it still didn’t not tackle the real problem, which is the continuous increase in property prices.
“Realistically basic stamp duty does not make any difference. There are actually no benefits. Regardless if you are a first time or the fourth time house buyer, the stamp duty is only a small part of the total cost. Stamp duty is cheaper but house cost still goes up. “
“How about making the price of houses go down? This is not doing anything for me. How is this giving back?” he said.
He also questioned why the government just stopped at PLUS and did not also implement toll rate freezes for all highways.
“Well, it is great if you are travelling long distance but what about daily travel? People use the LDP and Smart Tunnel but how many times do they use the PLUS highway? It is only useful when people go back to their hometowns but does not benefit ordinary people on the road,” he said.
Hussein added that tax cuts for retail goods only benefits that rich that can afford imported goods but “neglects the price of basic goods such as sugar and flour.”
Mohd Azlan argued that the 50 per cent of stamp will help reduce the burden of prospective house buyers.
Mohd Azlan Mohamad, 27, junior executive at a local bank
Mohd Azlan Mohamad applauded the 50 per cent of stamp duty exemption because it would help reduce the financial burdens of prospective first time house buyers.
“I think it is good. Now if I buy a house that costs RM350,000 I have to roughly fork out RM4,000 for stamp duty alone. So if it is 50 per cent off then I would save RM2,000, which could be someone’s salary for one month. Well, thumbs up for the savings,” he said.
Mohd Azlan questioned the need for a six per cent service tax on paid TV broadcasting services.
“I do not agree, for what? Why do I need to pay for entertainment at home? That is crap. My family shouldn’t be taxed for watching TV. Getting taxed for watching Astro Ria? For what?” he said.
Syahrul called the six per cent service tax for paid TV a “rip-off.”
Mohd Syahrul Nizwan, 31, project event manager
Mohd Syahrul Nizwan ridiculed the logic behind the 10 per cent sales tax exemption for mobile phones and questioned how it would help the public in cutting costs.
“Ten per cent? So? Do you expect people to go buy [the] BlackBerry Torch or iPhone 4 now? It is not like people are not using mobile phones right now so it makes no difference,” he said.
Mohd Syahrul added that government should also decrease toll rates instead of merely freezing the rates on PLUS highways.
“Why not reduce? It is still costly for ordinary people so they should reduce! What about the other highways? How many people use the PLUS highways? How about those living on the east coast?” he said.
He stressed that the government needed to do more than offer 50 per cent stamp duty exemption for houses because salaries still remained the same despite the spike in property prices.
“For me the stamp duty is not an issue. They should give us more leverage. While our income still remains the same, the price of houses continues to go up so how will 50 per cent off [the stamp duty] benefit us? We still cannot afford but developers are still increasing the prices in KL, and the Klang Valley,” he said.
Mohd Syahrul also called the six per cent service tax for paid TV a “rip-off.”
“The service already sucks and we have to bear more costs? It is not fair. It is a rip-off,” he said.
Nabil said the government needs more incentives to help the public.
Nabil Feisal, 27, CEO of MyInteractive Labs
Nabil said that the 50 per cent stamp duty exemption for houses was not realistic because the people simply couldn’t afford current property prices.
“It doesn’t make sense in the Klang Valley context for people who work and live here because the price is still too expensive. People will have to start moving out of Klang Valley so they can find affordable homes,” he said.
Nabil was not amused with the exemption of the 10 per cent sales tax for mobile phones and five to 30 per drop in import duties for retail goods.
“Well, I don’t think it will make any difference because while mobile phones and imported retail good are cheaper, the increase of service tax to six per cent will end up costing the public even more,” he said.
He added that public would not be able to “feel” the mobile sales tax exemption since hand phones are sold as a package with telecommunication companies
Nabil also ridiculed the six per cent service tax for paid TV.
“Well, it is ridiculous. I feel that it is unfair for the government to impose tax to people when Astro is not doing enough to improve their services. We have to bear the costs because the government wants to back GLCs instead of helping the people.” He said.
Jane Sidhu, early 30s, Assistant Professor
Jane believed that the 2011 Budget is not “major” and feels more can be done towards transforming a nation. The ideas tabled yesterday were existing ones, and she said that the new suggestions will not affect her in any way. She added that even if they did, it would be minimal.
Happy with the fact that there will be a five to 30 per cent discount on personal grooming items, Jane said she would be able to save a little extra since household items and personal grooming essentials can be costly at times.
She was expecting for property prices to go down, but appreciated the fact that toll prices for PLUS highways will not be increased for another five years. She was also happy that young married couples and graduates would now be able to get 50 per cent off stamp duty when they buy their first homes.
However she was unhappy with the government’s plan to build a 100-storey building in the city. She suggested the money be pumped into other sectors which will benefit the nation. Malaysia already has the Twin Towers and there is no need for another, she said.
As an academic, she was glad that the government was taking important measures to fund RM575 million to help students who wish to further their education.
“ThegGovernment needs a plan to reduce the number of foreign workers into the country and encourage more Malaysians to fill up available positions here. The RM474 million which will be used to enhance productivity and skills of non-graduates is also a good way to encourage more Malaysians to work here.”
Rizal Kamal, 35, Director/ Founder of Vivify & The Comedy Club KL
As a consumer and father, Rizal sees the 2011 Budget as promising but not from the business perspective. Being in the creative industry, Rizal was disappointed that nothing major has been done to encourage and promote the creative industry, which might boost the country’s economy.
He is, however, glad that there are proposals for green projects and he expects the Klang river to be set as an example of waste and pollution management. He believed that Malaysians deserve a clean and beautiful city, just like in Europe.
Rizal had hoped for the government to spend more on branding local products and creativity which will help promote tourism. Even if Malaysia was weak in “providing content,” he believes that government funds will help boost the industry especially in advertising and branding sectors.
He added that it was a good move to allocate RM100 million for Orang Asli and Pribumis, saying that this was one of the ways to appreciate their existence and their contribution to the country.
Rizal, however, questioned the massive amount of RM1.2billion that will be pumped into the Ministry of Women, Family and Community Development. His question was, “Why is there a need to fund that much money into this sector?”
He applauded the government for not increasing the toll rates on PLUS highways for another five years and commented that people will probably travel more because of this.
“It is good that the country is looking towards transforming the country by focusing on education and development. By doing so, the younger generation will be able to get jobs and lead better lives than their parents in the future,” he says.
Shobha Bala, 34, PA in a law firm
“It’s not really relevant to us. It’s not for us ordinary rakyat who work in the private sector. I’m disappointed,” she said, noting with envy the financial perks and 90-day maternity leave for civil servants.
“But I’m glad they’re not going to implement the GST next year. It’s a relief. There’s no way we can afford GST like in the other countries right now,” said the mother of two.
“I kind of suspected the government won’t be able to do it, because of the next GE (general election),” she added.
She did note that there were some positive aspects of the budget.
“I like the fact they are giving a 50 per cent exemption on stamp duty for first-time home buyers,” she said.
“I’m married with two kids and looking to buy a landed property nearby and have budgeted RM300,000 for it,” said Shobha, who was currently living with her in-laws in Kepong.
She also thought Putrajaya’s decision to start works on the MRT next year was “excellent”.
“My husband takes the KTM Komuter train to work every day and he’s always complaining there’s not enough carriages or the seats are [damaged].”
Shoba, who had planned to swap her old petrol-guzzler for a more fuel-efficient car next year, praised the Najib administration’s efforts to go green through tax cuts on imported hybrid and electronically-run vehicles.
“I’ll definitely consider buying one,” she said.
The downside, however, caused her grief.
“I’m irritated about the service tax going up one per cent. I mean, in Malaysia, you get horrible service and you’re charged for it,” said Shoba.
“The Menara Warisan (Merdeka) is a total waste of money. I think it’s just to line the pockets of crony companies because there’s not going to be an increase in tolls.
“What’s the point of having the tallest tower or whatever? We already have the Petronas Twin Towers.
“I think this is just a legacy for Najib. He won’t be remembered for anything else,” she said.
“They should stop these white elephants and put the money where it matters most, like building better public infrastructure, improving on facilities in schools and teacher quality,” said Shobha who applauded the move to hire native English speakers to boost the local command of the language.
But she also said she would reserve judgment on how the venture would turn out, noting the government’s decision earlier this year to reverse the teaching of Math and Science in English back to the national language.
Michael Reyes, 42, financial advisor
Reyes who trains youngsters to better understand and manage their finances wondered how Putrajaya planned to foot its ambitious plan to boost the national economy.
“How are they going to finance this?” he asked, worriedly.
The Petaling Jaya-born said the government was good at drawing up grand-scale policies, and stressed the problem was in making sure the policies worked.
He noted that the money would be better spent on areas that focused on improving knowledge and skills such as education, instead of “hardware” infrastructure, to propel the nation forward.
He remarked that the tax cuts on some 300 imported goods would not significantly change people’s entrenched spending habits.
“If I want to buy expensive stuff, I’m going to buy it regardless of the price,” Reyes said, adding that his company coached youngsters to prioritise value over the price of goods.
He praised the move to extend tax cuts on broadband equipment as a huge plus.
“It’ll increase the Internet penetration. The Internet opens the gate to a lot of things. It’s a very good move from the long-term development perspective. That’ll really help develop education... make it more rounded,” he said.
But like many members of The Malaysian Insider’s 2011 Budget jury, Reyes was highly critical of the government’s unbalanced allocation for funds.
“It’s not a mind-blowing, outrageously shocking Budget. This is a deficit budget. For a long spell now, Malaysia has been going on a deficit budget,” he said.
Reyes added that deficit budgets did not necessarily mean bad news but feared the last of the subsidies would be cut to enable the savings to be channelled to pay for the big projects.
Reyes noted with concern the government’s return to big spending on big projects and backing of big businesses, particularly Putrajaya’s plan for PNB to build a 100-storey tower near Stadium Merdeka.
“It’s a waste of taxpayers’ money,” he cried over the phone after learning the Budget report.
Reyes, who graduated with a degree in economics and computer science, did not think the Najib administration’s bid to build a high-income nation was reflected in the 2011 Budget.
“It’s going to take a lot longer,” he predicted.
Putt Kah Wai, 25, business development and marketing in an asset management house
Putt Kah Wai was glad to see the ambitious projects under the Budget tabled yesterday but was unconvinced that all of them would be seen through.
“I see a lot of initiatives, mainly domestic, to help build our nation,” he observed. “But I feel that there are too many things going on at the same time.”
He said one of the positive effect from the Budget tabled was an increase in Malaysians’ purchasing power.
As for the RM5 billion 100-storey Warisan Merdeka tower, Putt said it was unnecessary at this point in time to build such an extravagant landmark.
On the move to increase maternity leave for civil servants from 60 days to 90 days, however, he said it “ may backfire in productivity”.
“I think it gives a position where people can take advantage of it. I think 60 days is good enough. I think 90 days is more than enough, unless the remaining is unpaid leave,” he said.
He said the 100 per cent loan for first-time home buyers earning less than RM3,000 was a positive step towards increasing home owners.
“I think what the government is advocating [is] for people to invest internally,” he said. With the 50 per cent stamp duty exemption for first-time house buyers for houses which cost less than RM350,000, it would encourage the middle class to own properties, he said.
Although Putt was for the increase in wages for security guards, which is now between RM500 and RM700, up from RM300 to RM400, and also the increase in allowances for Imams and Al-Quran and Fardhu Ain (KAFA) teachers, he saw neglect in other sectors.
As for the prime minister’s goal to up PhD-qualified academic staff in research universities to 75 per cent, it was a good ambition to have, said Putt.
“More people will have the right skills to help expand the growth of GDP but the only thing the government is deprived of is this — we know how to train them, we know how to make them, but our government is bad at sustaining such talents…
“In the sense that with this implementation, there will be an increase of highly skilled workers. Thing in Malaysia is, they can’t sustain all these talents,” he said, referring to the brain drain effect.
He said overall, the Budget tabled was leading the country in the right direction and that a lot of the people’s suggestions and concerns were taken into consideration.
“These are very positive vibes for the audience. I guess most of the plans tabled are really good, achievable but at the end of the day it’s still the execution which matters,” he said.
Dennis Tan, late 20s, Construction material supplier
Dennis Tan found the Budget 2010 vague and lacking in details.
Tan agreed that the increase in public-private partnership projects as a “very good idea” but he wanted to know the total number of projects and their scales, rather than just the announced RM1 billion allocated for such projects.
As for the freeze on toll rates, he said that would affect him a lot as he spends about RM5 to RM6 a day just on tolls.
The prime minister had announced that first-time house buyers would get a 50 per cent stamp duty exemption for houses not exceeding RM350,000. How did Dennis feel about that?
“A lot of houses are above RM350,000 and even apartments are about RM300K,” he said. The cut off point should be around RM500,000. He said in Australia, where he currently held a permanent resident status, gave out AUD20,000 (RM61,000) for first-time home buyers.
He did, however, concede that he was happy about the 100 per cent loan to first-time house buyers earning less than RM3,000 .
“It is always better to own houses now than later. The population will continue to increase and the housing value will be going up. If you keep delaying going into the housing market, it will only get worse no matter how much you save, because you can’t catch up,” he said.
Tan said he disagreed with the six per cent service tax for paid TV broadcasts.
“It’s not good. Currently, multimedia information is a necessity.” By implementing the tax, he said, it would discourage Malaysians from embracing information technology fully.
Tan said that the five to 30 per cent import duty cuts on 300 goods preferred by tourists such as handbags and shoes, was a positive step to move the economy.
“It will induce more spending definitely, which is a good thing,” he said.
He commented on the RM1 billion allocated for the 1 Malaysia training programme.
“As long as it’s effective, it’s okay but the government will have to study it. It is great that they’re trying to promote unity but whether the money is spent wisely or whether it’s effective or not, it’s another story,” he said.
“I think we’re on the right track even though our budget definitely is lower in terms of percentage of GDP but nominal value has increased in the previous years,” he said on a positive note.
Yeo found the Budget vague.
Yeo Kien Kong, late 20s, Artist
Yeo, who agreed to be interviewed while he watched the Budget 2011 on television, could only express bewilderment. He felt that the government “is very vague in terms of implementing the Budget to create a better future for Malaysia. Let’s start with the PM’s first mission about empowering [the private sector], in the end it all depends on the attitude, yes? Creating more highways? Consider maintenance and the welfare of public transportation!”
Yeo was not pleased with the tax cuts for retail goods such as cosmetics and clothes. “They are meant for foreign tourists! But what about locals? We work like there is no tomorrow, and after we are given a holiday to rest, we either stay at home or go overseas... or shopping.
“Shopping for cheap imitations to satisfy our jealousies towards those who are rich! And the government is advocating anti-piracy laws by witch hunting consumers instead of the real culprits,” he said.
He then questioned what the prime minister meant by modal insan? “Does it work in line with money?”
The government also said that it would help women especially those who were physically challenged.
“How about men? Lelaki? Why doesn’t the government allocate more budget for the men to be more educated about love and harmony and most importantly, responsibility?” asked Yeo.
“I have no idea how this Budget will show that citizens will get a greater taraf hidup while all the essence of life and maintenance seem to be chucked aside. Houses? Security? Public transportation? Will the marginalised community and refugees seeking the safety and security benefit from this new national budget?”
Like many, Andri was cynical about the Budget.
Andri Iskandar, early 30s, in oil and gas, part-time rock musician
Like others, Andri expressed his cynicism at the Budget 2011. He had been following its announcement on the Twitter micro-blogging service, as his office had no television, and wanted to know two things: What were the execution strategies for all the projects, and were they sustainable in the long run?
“There seems to be a lot of rhetoric but no clear plan. I don’t deny that there are good things like extending relief up to RM5000 to ageing parents, caretakers, daycare, that would help people like me who have such parents but government allowing flexibility to self-determine fully-paid maternity leave, not exceeding 90 days from the current 60 days… this will still be left to employers to determine whether staff can have 60 to 90 days. It’s still the employer’s market.”
“This Budget seems to be more catered to lower incomes, but doesn’t seem to have much for middle class professionals like me. That bit about tax breaks for hybrid cars — how many people can afford such cars? I can’t,” lamented Andri.
The Budget didn’t seem to be well-thought out, according to Andri, who sensed it had a “cut and paste” feel to it.
“1MDB supplying multi-vitamins to poor children – how would such an effort actually turn them into better students? If they ate junk food or suffered from malnutrition, how would this make them smart?”
The greening of Kuala Lumpur was another bone of contention for Andri. Was the budget KL-centric, he wondered. Or was there more but it was not fully fleshed out in Parliament today because of time constrainta?
“And, why, why, are we obsessed with tall towers and buildings? What are they for?”
Hussaini Karim, late 50s, self-employed, retired military officer
Hussaini saw the Budget as ambitious and did not think any of the grandiose plans would be achieved within the stipulated time. His main reason?
“Malaysians are not able or capable of executing such strategies because of their main handicap: their lack of mastery of the English language. Yes the Budget seems to have covered all sectors, though it barely touched entrepreneurs. But, none of anything can come to fruition if no one can communicate in English very well.
“Instead of spending so much on infrastructure, can we spend on revamping the education system and that English is at the top of the list? We have PhD holders who can’t even speak English, as well as degree holders. They can’t get jobs because of this handicap. Hence this breeds insularity.
“And I don’t agree with getting foreign, native speakers coming here to teach us English. We have fantastic, local English teachers who are retired. They may be old but they teach good English. Fine. We can have the Brits, but Australians? They don’t speak proper English! Even their Government is revamping the teaching of English in Australia. What’s wrong with us locals? We are as good if not better than this foreigners.”
When asked about the shopping tax cuts, Hussaini said, “Any reduction in taxes is good. Doesn’t matter if it’s more for the ladies. But if you look from a macro level, this will affect the ‘seller’, the ‘business’.
“I was in SMEs before, after I retired from the military. There were tax cuts then and it killed us! So now, you’ll get cheaper underwear, but what about the manufacturer? We’ll end up bankrupt!”
As far as Hussaini was concerned, the Budget was just another political tool to appease Malaysians.
No comments:
Post a Comment