For the budget announcements, I will quote Malaysikini on the salient points. I think the web portal has summarised it very well.
The operating expenses are shooting and a cursory calculation, it is now almost 75% of the total budget.
We really need to do something to trim this and by doing so we can use more money for development expenses.
The whole budget speech can also be viewed at the Star. Click here.
For other points, here is what Malaysiakini reported:
The total expenditure was set at RM207.9 billion for 2009 compared to RM176.9 billion in 2008.
Of this amount, RM154.2 billion is for operating expenditure, while RM53.7 billion is for development expenditure.
In 2008, the operating expenditure was RM128.8 billion and RM48.1 billion for development expenditure.
Budget deficit up
The budget deficit is estimated to be 3.6 percent of GDP in 2009 and 4.8 percent of GDP in 2008.
Abdullah had in the previous year’s budget speech forecast a deficit of 3.1 percent for 2008.
Economic growth slowing
GDP growth for 2009 is estimated at 5.4 percent and 5.7 percent for 2008. The most recent official forecast is for GDP growth in 2008 is 5 to 6 percent.
Additional income tax rebate
Those earning below RM35,000 per annum will get rebate of RM400 compared to RM350 previously.
Those earning between RM35,000 to RM50,000 per annum will get a one percentage point reduction in their marginal tax rate to 12 percent from 13 percent previously.
Those in the highest bracket of RM250,000 per annum will get a similar reduction to 27 percent from 28 percent previously.
Those whose use less than RM20 of electricity per month will not be charged.
One-month bonus for civil servants
Government servants will get one-month bonus or at least RM1,000 to be paid in two installments – in September and December.
Those from Sabah and Sarawak will get free airfares to go home every two years, beginning January 2009.
Special allocations for Sabah, Sarawak
Sabah to get an additional allocation of RM580 million for upgrading infrastructures, while Sarawak will get RM420 million.
Hike in cigarette taxes
Excise duty will rise by 3 sen per stick from 15 sen to 18 sen. There was no increase last year.
Smokers will have to pay up to 60 sen extra for a 20-pack.
Staff training incentives
Firms can claim working capital allowance for upgrading their staff skills.
Toll charges for buses slashed
Toll charges for buses to cut by 50 percent for the next two years. The government will spend RM45 million to compensate toll operators for this.
To improve public transportation, the government has allocated RM35 billion in the next five years.
What’s not in 2009 Budget
No lowering the Employee Provident Fund contribution.
No hike in gambling taxes or alcohol duty.
No increase in the number of food items under price control