Here are the key highlights for Budget 2022 and its three thrusts.
Minister of Finance Dato’ Sri Tengku Zafrul Tengku Abdul Aziz is tabling Budget 2022 (Belanjawan 2022) in the Dewan Rakyat here at 4pm, today. The largest-ever budget allocation has been announced, RM332.1 billion which will put a strong emphasis on nurturing Malaysia’s growth as the country progresses further towards recovery and transition from the pandemic. Budget 2021 allocation was the largest in Malaysia’s history when it was announced last year.
With the theme ‘Keluarga Malaysia, Makmur Bersama’, Budget 2022 focuses on three thrusts – protecting and driving the recovery of lives and livelihood, rebuilding national resilience, and catalysing reforms. The budget is expansionary while laying the foundations for the government’s wider and longer-term reform efforts, and also set to complement the Malaysia Digital Economy Blueprint (MYDigital) and 12th Malaysia Plan.
Malaysia is currently at the final stage of the 6R – Resolve, Resilience, Restart, Recovery, Revitalise, and Reform. The International Monetary Fund (IMF) and World Bank forecasted the Malaysian economy in 2022 to expand by 6.0% and 5.0%, respectively, a return to the pre-pandemic annual Gross Domestic Product (GDP) growth trend.
According to Tengku Zafrul, the Federal Government estimated that its revenue collection in 2022 to be higher, RM234 bil or 14.3% to GDP. Malaysia’s GDP is expected to strengthen between 5.5% and 6.5% in 2022.
Budget 2022 objectives
- Protect and drive recovery of lives and livelihoods for the people
- Rebuild the resilience of the economy
- Catalyse socio-economic reforms
Budget 2022 allocations
- The largest-ever budget allocation of RM332.1 bil, surpassing Budget 2021 allocation of RM322.54 bil.
- RM233.5 bil in administrative expenses, RM75.6 bil in development, RM23 bil for the COVID-19 fund, RM2 bil for contingency expenses.
Budget 2022 highlights
These are the highlights of Budget 2022:
- The government will allocate RM2 bil under the Housing Credit Guarantee Scheme to assist those without fixed income to buy a house.
- RM1.5 bil has been allocated to ensure the continuation of low-income group housing projects.
- The government has removed the imposed Real Property Gain Tax (RPGT) on Malaysians and permanent residents (PR) and other than companies when they dispose of their real property assets from the 6th year onwards.
- Government introduce targeted aid called Bantuan Keluarga Malaysia (BKM). A one-off contribution of RM2,000 for households with three or more children and a household income-earning less than RM2,500.
- An additional RM500 will be given to single parents (mother or fathers) who have dependents and a monthly income of RM5,000.
- More than 440,000 households are eligible for new welfare payouts worth RM2.4 bil.
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- Minister of Education receives the biggest allocation of RM52.6 bil while the Ministry of Higher Education Ministry receives RM14.5 bil.
- Discounts for National Higher Education Fund Corporation (PTPTN) loan repayments will be offered by the government. It will come this Nov 1 until April 30, 2022.
- About 3 mil students will benefit from Back to School Aid worth RM150 each.
- Every higher education student from the B40 family will receive a tablet under the Peranti Siswa Keluarga Malaysia initiative.
Employees Provident Fund (EPF)
- Members’ EPF contribution rate that was reduced to 9% in 2020 will remain until June 2022.
- The government plan to give a 100% exemption of import and excise duties as well as sales tax for electronic vehicles (EV). This is an effort to minimise pollution as well.
- RM2,500 tax relief to be given to those who purchase, assemble, rent and lease EVs.
- RM4.8 bil is allocated by the government to guarantee 600,000 job opportunities under the Jamin Kerja Keluarga Malaysia initiative.
- Continuation of MyStep Initiative. 80,000 job placements in the public sector and GLCs to be offered.
- An incentive of RM900 per month (for 6 months) will be given to employers who hire apprentices comprising school leavers and graduates aged between 18 and 30.
- Jamin Kerja Keluarga Malaysia incentive may be expanded to employers who recruit women including single mothers and housewives in their workforce for a period, not more than 356 days.
- The government will make it compulsory for all public listed companies to hire at least one female director.
- RM5 bil will be allocated for Women Leadership Foundation to encourage female participation in the economic sector.
- 130,000 female teenagers in the B40 group will be received self-hygiene kits.
- RM11 mil has been allocated for free mammogram and cervix examinations.
- Special allocation worth RM13mil for the police’s D11 division to conduct investigations into sexual crimes against women and children.
- RM25 mil fund will be set up under the Yayasan Keluarga Malaysia to provide care for children who were made orphans due to COVID-19.
- RM200 mil has been allocated for the Chinese community for upgrading Chinese new villages and financing schemes for the small and medium enterprises (SMEs).
- RM145 mil has been allocated for the Indian community, among them for implementing programmes that strengthen the community’s social economy through Tekun Nasional, the national Entrepreneurial Group Economic Fund, under the Indian Entrepreneurs Development Scheme.
- RM11.4 bil has been allocated by the government to continue the Bumiputera empowerment agenda, and to bridge the racial gap in the country.
- The government will allocate RM300 mil to provide RM150 in credit into eWallets for youth aged 18 to 20 who are students at higher learning institutions.
- RM32.4 bil has been allocated for the Ministry of Health, the second-largest allocation after the education sector.
- RM4 bil added by the government in continuing efforts to address the COVID-19 pandemic and improve public health capacity, including RM2 bil to fund vaccination programmes.
- Allocation of RM100 mil to fund specialist programmes for doctors and dentists.
- Allocation of RM70 mil to prioritise mental health issues.
Sabah and Sarawak
- RM1.5 bil has been allocated for infrastructure development in rural areas of Sabah and Sarawak.
- Increased development allocations of RM5.2bil and RM4.6 respectively under Budget 2022.
- RM20 mil has been allocated to push Malaysia’s eSports industry. This includes RM5 mil to develop a drone sports excellence centre.
- The National Sports Council (NSC) will receive an RM10 mil allocation to elevate the national Paralympics team. This includes enhancing training programs and organising leagues for various sports as preparations for the 2024 Paris Paralympics.
- RM158 mil has been allocated to enhance and build sporting facilities around the country.
- Allocation of RM50mil to encourage people to continue leading an active lifestyle.
- The government will increase exercise duties on sweetened pre-mixed chocolate or cocoa, malt, tea, and coffee-based drinks.
- Extension of the 100% sales tax exemption on completely knocked down (CKD, locally-assembled) passenger vehicles and 50% on completely built-up (CBU, imported cars) including MPVs and SUVs for six months until June 30, 2022, to bring down the cost of vehicle ownership.
- Individual tax relief and tax deduction for employers on self-purchased booster vaccine costs.
- An allocation of RM1.6 bil for the tourism industry.
- RM600 mil for the Penjana Tourism Financing dan BPMB Rehabilitation Scheme.
- RM 85mil for 3-month special assistance for over 20,000 tourism operators.
- RM1,000 tax rebate will be extended until 2022 to encourage tourism.