ALTHOUGH the government intends to consolidate its debts, it is not completely ruling out an expansionary budget for 2020, said Finance Minister Lim Guan Eng today.

“While the government intents on consolidating our debt, we may consider an expansionary budget to mitigate the negative effects of the trade war,” he said during his keynote address at an economic forum today.

An expansionary budget means the government using budgetary tools to expand the money supply in the economy, so that the people can increase spending.

Lim also reiterated that Putrajaya is confident of meeting its target to cut its financial deficit position from 3.7% to 3.4% of the gross domestic product (GDP) this year.

He added that it is unlikely that new tax regimes will be introduced in the upcoming budget and the government certainly has no plans to implement inheritance taxes.

As for corporate taxes, which the business community has urged the government to review time and again, Lim said the current fiscal and economic conditions do not afford the government the opportunity to slash the tax.

He said the government has the intention to lower the tax rate, which currently stands at 24%, gradually.

However, this can only be assessed once the economic and financial conditions of the country recovers, he said. – August 29, 2019.