The Prime Minister, YAB Dato’ Sri Mohd. Najib Tun Abdul Razak, who is also the Minister of Finance, presented the 2011 Budget on Friday, 15 October 2010.
The theme of the 2011 Budget “Transformation Towards a Developed and High-Income Nation” reflects the Government’s focus to transform the nation into a developed, high-income economy with sustainable development and is to be spearheaded by the private sector.
This Budget focuses on four key strategies:
1. Reinvigorating private investment;
2. Intensifying human capital development;
3. Enhancing quality of life of the people of Malaysia; and
4. Strengthening public service delivery.
These strategies include measures to emphasize the role of the private sector as the engine of growth to move the nation to a high-income economy, strengthening socio-economic development to ensure a better quality of life of the people and to enhance the productivity of the civil servants.
2010 Budget Highlights:
1. Allocation of RM212 billion for Budget 2011 of which RM162.8 billion is for operating expenditure and RM49.2 billion for development expenditure.
2. Federal Government revenue collection is estimated to increase 2.3 per cent to RM165.8billion in 2011.
3. The deficit for 2011 is expected to further decline to 5.4% of GDP, compared with 5.6% in 2010.
4. Twelve National Key Economic Areas (NKEAs) to generate over RM1.3 trillion (RM 1300,000,000,000) in investment and create 3.3 million job opportunities.
5. Government allocates RM850 million for infrastructure support for corridor and regional development. Iskandar Malaysia (RM339 million), Northern Corridor Economic Region (RM133 million), East Coast Economic Region (RM178million), Sarawak Corridor of Renewable Energy (RM93 million), Sabah Development Corridor (RM110 million).
6. A sum of RM411 million is allocated for the research, development and commercialisation activities.
7. The Government proposes that the rate of service tax be increased from 5% to 6%.
8. The Government proposes that import duty on approximately 300 goods preferred by tourists and locals, at 5% to 30%, be abolished. The Government proposes that sales tax be exempted on all types of mobile phones.
9. Multimedia Development Corridor programme is allocated RM119mil. Focus is on creating an innovative digital economy.
10. Import duty and sales tax exemption on broadband equipment are also extended for two years until 2012.
11. Government revises growth rate for 2010 to seven per cent from six per cent previously.
12. Income per capita to increase 6.1 per cent to RM28,000.
13. Private investment to expand 12.5 per cent to RM86 billion.
14. Private pension fund to be launched in 2011 to benefit private sector employees and the self-employed.
15. A new landmark, Warisan Merdeka, is expected to be completed in 2020. It will include a 100-storey tower, estimated cost of RM5 billion.
16. To support financial liberalization policy, the government will implement bold measures to revitalise the domestic capital market, particularly diversifying investment products, liberalizing equity holding requirements and investment limits, providing attractive incentives as well as enhancing cooperation with foreign bourses.
17. Government-Linked Investment Companies (GLIC) to divest shareholdings in major companies listed on Bursa Malaysia and are allowed to increase investment in overseas markets.
18. Bursa Malaysia to launch Sukuk and conventional bonds to meet retail investors' demand for fixed income instruments.
19. RM29.3bil is allocated for Ministry of Education, RM10.2bil for Ministry of Higher Education and RM627mil for Ministry of Human Resource.
20. The Government will establish a Talent Corporation under the Prime Minister’s Office in early 2011.
For further details on 2011 Budget, please log on to: HERE & HERE