PRIME Minister Anwar Ibrahim told Bloomberg Television today that his government would try to lower Malaysia’s huge debt and reduce the budget gap.  

He rejected the reinstatement of the goods and services tax (GST) for the present, or any other move that could cause more hardship for the poor.  

“I have a huge issue of having to introduce taxation policies or new initiatives when it affects the plight of the low-income group,” he said.  

“We have reached the (debt) ceiling and we should gradually go down.”

The level of Malaysia’s actual debt is currently 61% of gross domestic product (GDP).  

Anwar warned that the country was facing RM1.5 trillion in total debt and liabilities with a budget deficit of around 5.8% of GDP as of last year.  

He preached fiscal prudence, saying that the maximum debt service was approaching uncontrollable levels.

Anwar also made it a priority of his government to shield low- and middle-income groups from increases in the cost of living.  

He said Malaysia could count on some growth in revenue from taxes, along with petroleum products.

His government said it would increase electricity prices for multinationals and heavy users, as part of the prime minister’s attempts to channel subsidies and spending towards the needy.

Furthermore, government subsidies were expected to reach around RM80 billion, with concessions on fuels and cooking gas expected to account for about half of that.

Anwar will table a revised 2023 budget in parliament on February 24. – January 30, 2023.