Adapted from The Star 30 Sept 2005

Budget 2006 highlights

KUALA LUMPUR: Prime Minister and Finance Minister Datuk Seri Abdullah Ahmad Badawi presented the budget for 2006 to Parliament Friday with the theme "Strengthening Resilience, Meeting Challenges", reflecting the main thrust of the budget.


Datuk Seri Abdullah Ahmad Badawi presenting the Budget for 2006 to Parliament Friday.
HIGHLIGHTS


The 2006 Budget strategies focusses on:
1. Implementing proactive Government measures to accelerate economic activities
2. Providing a business-friendly environment
3. Developing human capital
4. Enhancing the well-being and quality of life of Malaysians

The budget plans an expenditure of RM136.8bil, an increase of 5% over 2005, aimed at better development and quality of life for the people.

Of the amount, operating expenditure, which includes the normal runing of the government such as civil servants pay, will be RM101.3bil; while the rest will be for development expenditure, which will also involve new projects.

Cigarette tax increased by 13%, while tax on liquor up by 9%.

Bonus for civil servants to be paid in two equal instalments in October and November.

Automatic income tax relief of up to RM4,000 for each child (RM9,000 for disabled children) studying in local institutions of higher learning.

With the exception of vehicles in Sarawak, private diesel vehicles exceeding 1,600cc will be given road tax deduction of 40%, effective Oct 5.

Stamp duty and real property gains tax to be abolised on mergers and acquisitions of listed companies. This will be effective from Oct 1 this year and till the end of 2007. The aim is to strengthen the capital market.

A total of 334 posts will be established to facilitate one-stop centres in all local authorities in expediting the processing of licences and permits, as well as payment of assessment fees and fines.

E-payment transactions using credit cards at counters and online will be implemented at the Royal Malaysia Police Force (PDRM), Road Transport Department, Immigration Department and EPF as well as hospitals.

Emphasis will be given to skills training and technical expertise. RM493 million is allocated for the enrolment of students in technical, vocational and skills training, which will be increased from 72,000 students for this year to 98,000 in 2006.

In addition, an allocation of nearly RM1 billion is provided for trade and industrial training at Institut Kemahiran MARA, Pusat Giat MARA, Institut Kemahiran Belia Negara, Industrial Training Institutes and Advanced Technology Training Centres.

To continue its long war on drug abuse Pemadam is to review rehabilitation methods. RM207 million allocated for National AntiDrug Agency to undertake prevention treatment and rehabilitation programmes and management of 29 rehabilitation centres

Another concern has been AIDS. The health Ministry is to set up Advisory Panel to formulate an integrated action plan to fight HIV and Aids. Number of cases this year has risen to 65,000

Government to spend RM1.1bil to build 26,000 housing units for teachers, members of the armed forces, police, firemen and customs officers.

A Health Tourism Unit will be established under the Ministry of Health to improve the quality of health services to attract more foreigners to seek private health services in Malaysia.

Khazanah Nasional will be establishing a National Agriculture and Food Corporation. Initial apital for the project will be RM500mil. It is aimed to make it a centre of excellence in agricultural supply chain management.

The government has been emphasising on development of biotechnology and in line with this it is contributing RM100mil to launch the 'Malaysian Life Sciences Capital Fund'. This is to encourage investments in biotechnolgy to be managed by Malaysian Technology Development Corporation.

The agriculture sector is allocated a sum of RM2.8 billion for development expenditure, primarily for agriculture, animal husbandry, fishery and forestry.

Agriculture Counsellor Offices will be established abroad to promote Malaysia's agricultural products.

The Fund for Food (3F) will be further increased by RM300 million to ensure sufficient funding for the food production industry.

The Government will establish a new company with an initial funding of RM200 million to develop forest plantations commercially.

RM400 million allocated to finance agricultural projects of GLCs.

Group relief to companies within a group, with a minimum of 70% ownership between them. The group relief allows 50% of a company's current year losses to be offset against the profits of other companies in the same group.

For companies with Pioneer Status, accumulated losses and unabsorbed capital allowances during the pioneer period will be allowed to be carried forward and be deducted from the post-pioneer income.

To provide skilled managers and directors with integrity, especially for GLCs, a Management Leadership and Directors Academy will be established as a centre of leadership excellence.

To encourage more REITs, the Government proposes to allow tax deductions on legal, valuation and consultancy expenses.

A Yayasan Amanah Hartanah Bumiputera, a Bumiputera property trust foundation with an initial capital of RM2bil is to be established to purchase commercial properties in prime locations.

The Government plans to upgrade teacher training to ensure that all teachers in secondary schools and at least half the teachers in primary schools were graduates.

Abdullah said said the government would stress on rural development to give a better life to the rural people. This includes better education, water and electricty supply and roads. About RM5.7bil would be spent for this.

The government has pledged to go all out and fight increasing crime. In line with this the police force is to be reinforced. RM3.5bil has been allocated for operational expenditure and RM493mil for development expenditure. In addition police personnel in lower ranks would be reimbursed for stitching uniforms with up to RM100 per uniform for three uniforms.

One of the aims of the government was to lower the the budget deficit from the current 3.8% of the gross domestic product to 3.5%. It was 5.6% in 2002.

Sabah state has been allocated RM2.3bil for 2006 to build roads, and improve water and electricity supply as well as education and health services

Sarawak has been allocated RM2bil to provide better roads, airports and education.

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What do you all think?

This Budget in my opinion benefits the rich and the poor. However, the biggest loser will be the middle class.

I am not too sure though. ;p

Harga barang semua naik ooo!!

yeah...im really going to complaint a lot when i get back home and will have to fish out loads of my pocket money to pay for my car petrol

Haiya, harga telor naik from 50 sen to 80 sen. Life is killing me.Gomen should do something to stabilise inflation rate that is up 100% since last year!!!

Reducing road tax is not enough!Gomen should reduce income tax which is strangling Malaysians of their hard earned money? Pay a lot of tax, but services by gomen still sux and sub standard!! I mean, 4 billion RM ton maintain buildings, maintain what, the Petronas Towers, KLIA,the expensive street lamps of Putrajaya, i am sure some cronies will become instant millionaiores soon!!!!! 4 billion could send thousands of Malaysians overseas!

I doubt that the poor will get that much money, what gomen gonna do, give them hampers that could only last 3 hours???The gomen always say help this,help that, but every year we see the poor pleading in TV3 for food and clothes and dropping from school just to earn RM2 and we see gomen people spend 5 million for retirement parties!!! Even the middle class are not getting much benefits, thats why many middle class malaysians when they have enough money,they migrate somewhere, coz Malaysia is so expensive-cars,schools,universities+ bad service+poor pay.

Sometimes i cant help but blame the previous gomen, i believe Malaysians are still paying for the mega projects and debts initiated by previous gomen, sigh, wat to do,like dat la.Well nothing is perfect in this world and i wish the best for Badawi in leading this country to a better future.Sorry for my ranting.I think the budget is no different from last year, just big talk only and a temporary placebo for our misereable existence.

I would never say that the Twin Towers and the general KLCC development as a wasted megaproject. I like I like I like!

Haha. But it doesn't fit its purpose except to look pretty. If you could only find out how many vacant offices are there in the KLCC.

That is the thing about M'sia. They want to build 1st class projects, but ignores the citizen's welfare as a whole.

First class? They can't even fix the pothole in front of the McDonald's near my school. Every time a sexy Porsche or BMW drives past in the rain, it churns up so much water that you can't even see the car.

Agree. I just wish the design of the twin towers was better.

We can't let a few poor ppl stop us from spending some money to beautify our country.

Malaysian poverty rate is already very low and the only poor Malaysians are those who cannot work bcoz of illness,old age or physical damage fom accidents and the like. The kind of help these poor ppl need to survive is not that great to the point that we cannot do anything else but to help them only.

America has poor ppl living in the streets but Americans still build tall buildings.

Like I said before, it's not really the beautification of the country. It is when the buildings are useless, not fit for its purpose, need too much $$ to maintain.. etc.

The thing diff about US and M'sia is that US is already a developed country.. while M'sia is still developing and have a long way to go. Hence, for developing countries, the welfare, education etc are important to ensure a strong economy in the future.

Also, US is one place that I wouldn't want to compare M'sia with.

Rokok naik harga oii..!!!

^^Heheh, that's what we call sin tax kat sini. Not good for your health lah.

but I would and I just did.

Just to get my point across, I will make whatever comparison necessary. No big deal.

You can compare China with America if you like. China is much poorer than Malaysia but they still build very tall buildings.
My point is: no matter how rich a country gets there will always be poor ppl and these unfortunate ppl have no vote in big business decisions.

These are already taken care of.
Malaysian bachelors degree level education for the past few batches is already between 20%-30% which is compareble to the US figure of 25.6%.
In poverty eradication the only problem is identifying hardcore poor ppl living in remote areas and getting the aid to them.

Last time I checked, KLCC was stilll making a profit.

The thing about US is that their poor and their rich's gap is too wide. Probably if you compare M'sia to some of the European countries, Singapore or Australia would be much better.

But I guess it's your choice what you want to compare M'sia with.

I hope that it is all like you said.

"The daily cost of running Malaysia's Petronas Twin Towers, in Kuala Lumpur, is US$196,000"
http://app1.chinadaily.com.cn/star/2003/1120/fo7.html

"Until Taipei 101 was completed, the world's tallest buildings were the twin Petronas Towers soaring above Kuala Lumpur since 1998. For years, the project was also one of the world's biggest white elephants."
http://www.smh.com.au/articles/2004/03/26/...s&oneclick=true

But I guess this doesn't prove that it is making a loss. But it still proves that it is not fit for its purpose and need too much $$ to maintain. I do not have an article to prove that half the office space in Petronas Twin Towers are vacant because I've been verbally told by my lecturer. I'll try to find a proof.

Taipei 101 is ugly, the PTT is better.I also the Petronas Towers was a tool to enrich some of our former PM's close connections especially the current second richest man in Malaysia, Ananda Krishnan.

I heard that KLCC paid Ananda Krishnan every year for the land since KLCC only rented the land... Is it true..?

That's a genuine case.another is so ironic that it's nutcase. sometimes it defy the logic when a very pretty good in condition (when i said good it means really good)road they paved it again..lol.the cronies get so much profit

then stop buying them!!!

p/s:kalau tak nanti jerawat makin banyak...hehehe

Any advice how to quit?
When i tried to quit, i gain weight more than 10 Kg...

Well try nicotin gum and jogs a lot.how's that? i've never been a smoker though..

Ananda sold one tower to Petronas for the price of the 2 towers. 2
Shhhhhhh... this is top secret. 2

Try using a bomoh, i red one ad next to a 7/11 that a bomoh could help get off cigarettes. 2

Thanks..



Errrr... Thanks also

haha...well..i dunno..im not a smoker to tell u what to do too..but my dad was...and the reason y he quit was me i think...

so i think u must have the willingness first..and hate it forver

then must have someone to control u to overcome your addiction to smoking...like a girlfriend or sumthing...i dunno..but u can try that out..at least u will listen to her cos u love her or else she merajuk

hmm.. that's a good idea.. but... i don't have any she...

definately no "he" either right???

Ehem. After the bomoh start sucking something else.

LOL

Ho ho ho ho.

im wwaaaaaaaay late, but i only have this to say
*points and laughs at smokers* kekekekekekeke!! 2

According to this report , Malaysian foreign debt is only 31.5 billion Ringgit which is around 8.5 billion US Dollars

I heard that a significant proportion of the RMK 9 is through borrowing. 2

Badawi and whoever is in charge of the economy do something about this.
But actually, if u combine this debt with the publlic debt, Malaysia's debt is actually US$50++ billion, its not the government's debt but it will go into our forex index and is a liability to the economy.

Hey, the International reserves is down 700 million dollars to 79 billion dollars, what is going on?Maybe the money is to pay bonuses for civil servants?
But I am sure this figure will go down drastically after RMK 9.

Wait and see la...

Nowander Merril Lynch downgraded M'sia as an investment haven.

I think that downgrade was only for investments in securities.

Malaysia is still a very good place to set up manufacturing invetments.

We are too use to the good news. That once we hear a bad news, we quickly push it aside and bring up the good news. Investment in securities and stocks is a part of the economic cycle. We can't survive on manufacturing alone. M'sia is a manufacturing investment haven because of the tax benefits. Where the first 3 years they are free from corporate taxes and the subsequent years they are particially subsidised. We need to push up our ratings so that we have for FDIs and promote the growth of M'sia.

Recently, the massive loss over bad loans is reported in Bank Islam. They found out that the people did not check on the credit quality of the creditors. It is tragic.

Until we solve the bad, then we can praise the good.

Pak Lah has instructed the Bank Islam fiasco to be investigated as a matter of priority. Rightly so. There are people who trust the bank blindly just because it has the name Islam attached to it. If anything, it should even greater accountability than the syariah non-compliant entities. I bank with Maybank and Standard Chartered.

Portfolio investments are nothing compared to fixed investments

and I don't blame Merrill Lynch for downgrading the Malaysian bourse.
Bursa Malaysia truly sucks.

^Not sleeping yet Iron? Or you staying up for sahur?

OK I'm asleep now

It's such a pity because M'sia is actually considered the favourite Islamic banking nation. With this news spreading around.. I really do not know what will happen. Hehe.

^According to the recent international Islamic finance conference held in KL, Malaysia is still at least 10-15 years ahead of the Gulf countries including Dubai in terms of its Islamic banking infrastructure. Hopefully lessons are learnt and mistakes not repeated from this incident. Do you know that non-Muslims form the bulk of users of Islamic banking products in Malaysia? This was again reiterated over the news last night in an interview with Arab-Malaysian's Tan Sri Azman Hashim.

Is that true? Hmm, that is fascinating. Probably because the Islamic Banking products are not that widespread and there are arbitrage opportunities or the rates are more competitive than the normal banking products. That is interesting.

But I thought M'sia always boast to be the best in Islamic banking. Hmm, like I said again. We always praise the good.

We do? Its just about getting the right people to run the bank. And we only do this after we lose millions of RM like the PSC scandal and MAS problem.

Other banks like Maybank are also employing the Islamic financial system to attract funds from the cash rich Middle East as they are taking out their money from Europe and the US.

What is PSC? Is it the Proton? Yup I know.. These public listed companies are really hiding a lot from us. Hmmph! Hehe.

PSC-Penang Shipyard corporation.

This company is currently building 6 state of the art Meko (german) 100 class warships for the Royal Malaysian Navy. RM6 billion was allocated for one of the biggest naval project in South East Asia but apparently the company claimed RM6 billion is not enough
.The PAC claimed that the company mismanaged the funds and argues that a proportion of the fund was probably embezzled. Many people blamed the white hair monster Amin Shah ,the corrupted financer who led the PSC to financial ruin by taking on stupid money wasting projects. Note, this is a military project, but our MINDEF gave it to a stupid corrupted banker who has connections with certain politicians.The MINDEF had to fork an extra RM200 million RM to keep the project afloat. . Due to lack of funds, the first completion of the first 2 warships was delayed (they failed the sea trials) and puts the company in limbo over their capability to finish all 6 warhips and to take any further projects from MINDEF to build the remaining 21 offshore patrol vessels the Navy plans to construct in the next decade or so.

Lets count the loss, bank Islam= RM 700 million, PSC=RM200 million, MAS=RM200 million.Malaysia lost RM1.1++ billion !!!!!!!!!!!!!!!! .

Don't worry , Malaysia Boleh!!!! 2

Oh $hit. That is a lot of money. I didn't know about the PSC scandal. How about Proton? I heard something about Proton making losses as well? Hmm. I am not too sure. Is the open tendering already up in M'sia? I thought Pak Lah promised us that. I hope that he is not a NATO (No Action Talk Only).

Nah, Proton's losses are due to their loss of the local car market and because they just acquires the expensiveMangusta motorcycle company. Its stiff competition for Proton now. Proton's not Badawi's pet project, so he's not giving Proton any face.

Proton's cars handling like the Gen-2, Waja and Savvy are very good and supperior compared to some of its Honda and Toyota rivalries and even VW's cars cause Proton has some Hethel magic from Lotus to enhance Proton's cars performance.The only inprovement Proton need is to improve the interior quality and we'll hopefully see as the Tg.malim Plant will assemble Proton cars automatically. Wow, gone are the days from Proton when there are not enough Waja cars to fill demands, now Proton has difficulty selling their cars now. Well, all the best for Proton.

Yea. Proton was pretty sellable last time. I still remember their Wira, Perdana, Waja and Satria. I loved their Satria GTI and Putra. Then they came up with a few not really good designs such as the Arena and Juara. :\

I drive a Juara........

I don't think it's pretty. :S Or maybe it's just Chinese superstition. A bread shaped car looks like a coffin. Hope you are not offended. *mohon maaf*

I have had that warning b4 from a Chinese pal of mine, dun let the cargo space empty or a ghost will hitch a ride. My action, i tampal a lot of Surah stickers at the back that will burn any ghost trying to hitch a ride, mmmmmmmmm, maybe i should use Sakai magic just to make sure. 2 2

What's worst about my car, its car plate no. is 1244, 4 = die in Chinese, 1244= want to die die.2. Some of my friends laugh at this and even called our van the Coffin Mobile. 2. Imagine an pug looking Juara chasing u with that plate.

I admit its not pretty, but its a practical car, not too big, not too small,Proton should give it a face lift like Perodua did with their Kenari.Bur nooooooooooo, Proton rather spend money building its fancy Star wars looking HQ building in Shah Alam while its sales drop. I dun wanna sell th Juara becoz its too darn cheap on the second hand market, better keep it until the end of the world.