Budget 2014: Conclusion & Highlights

Budget 2014: Conclusion & Highlights

Prime Minister tabled the 2014 budget with a promise of fulfilling promises made in the heat of the general elections. This reflected in the budget theme of strengthening the economic, transformation and delivering what was promised.

The 2014 Budget will allocate a total of RM264.2 billion to implement programmes and projects for the well-being of the rakyat and national development.

Of this amount, RM217.7 billion is for Operating Expenditure while RM46.5 billion for Development Expenditure.

Some of the highlights include :

  • The domestic economy is projected to grow at a stronger pace of between 5.0 per cent to 5.5 per cent.
  • The unemployment rate is estimated at 3.1 per cent while the inflation rate will remain low at between 2 per cent and 3 per cent.
  • Goods exports are expected to grow 2.5 per cent due to improving external demand while on the supply side, the construction sector is expected to grow 9.6 per cent.
  • The per capita income for 2014 is expected to reach RM34,126 compared with RM24,879 in 2009, an increase of 37 per cent over six years.
  • It is even possible that Malaysia will achieve developed nation status much earlier than 2020.
  • Agropolitan project and oil palm-based industries to be implemented in Sabah Development Corridor, Samalaju Industrial Park and Halal hub in Sarawak Regional Corridor.
  • Services Sector Blueprint to be launched next year.
  • Logistics Sector Master Plan and National Aviation Policy to be formulated.
  • RM3 billion in soft loans under the Maritime Development Fund through Bank Pembangunan Malaysia.
  • To replace existing air traffic control and management system in Subang, a new air traffic management centre costing RM700 million will be built at KLIA.
  • Difference in minimum wages paid by employers for the period of Jan 1, 2014 to Dec 31, 2014 to be given further tax deduction.
  • RM100 million to create Night Market Traders Entrepreneur Scheme under Bank Simpanan Nasional.
  • Ministry of Health, Ministry of International Trade and Industry, and Ministry of Finance to undergo performance evaluation based on Outcome-Based Budgeting (OBB).
  • To conduct audit on projects valued at more than RM100 million.
  • Monthly Tax Deduction as Final Tax, effective from 2014 assessment year.
  • Sales tax and service tax to be abolished, to be replaced by Goods and Services Tax (GST) effective April 1, 2015.
  • GST rate is fixed at 6 per cent.
  • GST will not be imposed on piped water and first 200 units of electricity per month for domestic consumers.
  • Transportation services such as bus, train, LRT, taxi, ferry, boat, highway tolls as well as education and health services are exempted from GST.
  • RM62 million for ‘park and ride’ facilities at LRT, KTM Komuter and ERL stations.
  • RM15.3 million for Centralised Taxi Service System to ensure efficient mobilisation of taxi services.
  • RM28 million for building ‘last city terminals’, upgrading of bus stops and providing ‘drop-and-ride’ facilities.
  • RM28 million for refurbishing Electric Multiple Unit trains to ensure frequency and efficiency of services.
  • Bumiputera equity holdings and property ownership to be increased through Skim Jejak Jaya Bumiputera, Skim Amanah Saham Bumiputera 2 and strengthening of  Bumiputera real estate institutions.
  • SME Bank to establish Bumiputera Equity Fund with an allocation of RM300 million to provide loans to credible Bumiputera companies to take over listed companies or companies with potential to be listed on Bursa Malaysia.
  • RM200 million loan facility by SME Bank for development programmes for Malay Reserve Lands in strategic areas.
  • Bumiputera Entrepreneurs Start-Up Scheme (SUPERB) to be set up with RM30 million initial fund.
  • Expenses incurred by anchor companies, especially GLCs, to be given double tax deduction in order to enhance vendor development programmes.


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