Budget 2021 should be prioritised to ensure economy, businesses recover from COVID-19 — Economist
26 Oct 2020
The 2021 Budget expenditure programmes and fiscal measures and initiatives should be targeted and prioritised to help the nation, economy and businesses, as well as workforce to reset, revitalise and recover from the pandemic, an economist said.
Socio-Economic Research Centre (SERC) executive director Lee Heng Guie said the budget’s priority is to cement a sustained economic revival and business sustainability, focusing on two-pronged initiatives and strategies.
He said for the immediate and short-term, fiscal transfers, tax relief and fiscal assistance, as well as incentives should focus on targeted households and businesses to facilitate quicker recovery amid an occurrence of a third wave of the virus.
“The travel and tourism sector, as well as, small businesses should be given more fiscal support (such as deferment payment of tax and service tax, and tourism tax exemption) as they are the hardest sectors and would take a longer time to recover and get back on firm footing,” he said.
He said this in an article entitled ‘The 2021 Budget: Measured Fiscal Booster Dose’ (second of two parts) published in the ‘Thought’ column on www.bernama.com.
Lee said for the medium and long-term, he suggested measures and initiatives to help the domestic workforce and businesses, especially small and medium enterprises (SMEs), develop new capabilities in digital technologies and set the stage for long-term growth.
“The National Economic Recovery Plan and 12th Malaysia Plan (2021-2025) will also take on the medium and longer-term economic direction and policies,” he said.
Lee also called for the Budget 2021, to be tabled on Nov 6, 2020, to provide measures and initiatives to protect the vulnerable B40 households and affected sectors of society, boost purchasing power, revitalise domestic and foreign investment, and create more jobs, as well as improve income.
He said the government also needs to sustain consumer spending via financial assistance to targeted households, including tax-free holiday for individuals with chargeable annual income of between RM100,000 and RM150,000, and reduction in personal income tax rate for middle-income earners, among others.
Full article can be excess at https://www.bernama.com/en/thoughts/news.php?id=1893297