PETALING JAYA: Opposition Leader Datuk Seri Anwar Ibrahim unveiled an alternative budget that promises reduction in personal and corporate taxes with the government coffers compensated by, among others, revenue from the auctioning of Approved Permits (APs) for the import of vehicles.
Anwar also said that if the opposition were to form the federal government, which based on his prediction would be less than two weeks from now, big-ticket items such as the RM15.3 billion High-Speed Broadband (HSBB) project would be shelved while the RM35 billion allocated to upgrade the urban transportation sector would be reviewed.
He said the specific percentage of tax lowered would be deliberated with Pakatan Rakyat (PR) leaders but reiterated that it was the principle of PR to reduce personal tax on all bandwidths in order to alleviate the burden of the rakyat and that the corporate tax rate be competitive to attract foreign investment.
“My economic philosophy has always been lower taxes will increase productivity. I’ve not changed from this position,” he told a press conference yesterday on Parti Keadilan Rakyat’s (PKR) response to Budget 2009 tabled by Prime Minister Datuk Seri Abdullah Ahmad Badawi last Friday. Incidentally the press conference on the budget also marks the exact date when he was sacked as deputy prime minister 10 years ago.
For year of assessment 2009, the top personal tax rate stands at 27% while corporate tax is 25%.
Anwar said the Ministry of International Trade and Industry should auction the APs to the highest bidders rather than freely give them to a select pool of businessmen.
He said based on an estimated 70,000 APs issued per annum and at a conservative RM25,000 market price each, such auction would provide an additional RM1.75 billion to government coffers.
Anwar pointed out that APs were a clear case of abuse in the New Economic Policy (NEP) programme in which a few Malay businessmen have squandered and enriched themselves in the name of “Melayu”.
He also took a swipe at the Budget 2009 allocation of RM35 billion for public transportation upgrade in the Klang Valley and Penang to be under the care of the Public Land Transportation Commission, which is a federal body in the Prime Minister’s Department.
“Until and unless power over public transport planning and design is given to the state and local authorities, these problems cannot be properly solved,” said the PKR adviser while alleging that award of tenders and contracts to favoured companies such as the Scomi Group may lead to accusations of nepotism.
Anwar criticised the Budget 2009 proposals for failing to address the issues of ongoing reduction in purchasing power, job insecurities, low wages and a big gap between the rich and poor.
Describing Budget 2009 as a sign of deteriorating public finances and economic sluggishness, Anwar said it was alarming that operational expenditure increased 20% to RM154.2 billion from RM128.8 billion in Budget 2008, adding that the figure is almost double the Budget 2004 operating expenditure of RM80.5 billion.
He stressed that the high fiscal deficit of 4.8% this year (3.2% in 2007) described as one-off by the government was least convincing as there have been deficits for a decade and Malaysia’s credit rating outlook was downgraded by Standard & Poor’s to the fourth lowest investment grade.
“A 3% fiscal deficit is more tenable for the country. Malaysia is perhaps the only oil-producing country in the world registering a fiscal deficit,’’ he noted.
Expressing confidence to form a new government, Anwar said he had last week met some Barisan Nasional (BN) members of parliament (MPs) nationwide and described the meetings as “very good”.
“My colleagues and I met MPs from Sabah, Sarawak and the peninsula. Very difficult to meet them as we are monitored by special branch 24 hours a day but yet we met them,” Anwar said.
Reminded by the press that he had 14 days left to form a new government, he replied with a quote from a former British prime minister, “A week is a long time in politics.”
The opposition leader also quashed rumours that he was scheduled to be at Istana Negara yesterday to meet the King.
Yong Min Wei
The Edge
03/09/08
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