THE revised Budget 2023 tabled yesterday by Finance Minister Anwar Ibrahim is very much focused on reviving the B40 and M40 socio-economic segments in the country to ensure that no one is left behind, economists said.

Associate Professor Dr Ahmed Razman Abdul Latiff said the budget shows that Anwar, who is also prime minister, is determined to reduce the inequality in income among the various groups.

“If we look into the initiatives, it is quite comprehensive and not just simply given in a form of cash handouts for the hardcore poor, B40 or the M40.

“Instead it ensures that these groups will have higher disposable income and better quality of life,” the Putra Business School economic analyst told The Malaysian Insight.

Razman said this Budget has more initiatives that favour the B40 and M40 groups.

“The cash handouts still continue and at the same time the quality of life for the B40 will improve through the various schemes like the refurbishment of People’s Housing Project, refurbishment of schools, hospitals that cater to this group, even in the outskirts.

“Even those who are on the bankruptcy list are getting discharged.

“This budget also exempts those with a monthly income of RM1,800 and below from paying their National Higher Education Fund Corporation loan,” he said.

Under Budget 2023, the B40 group could receive up to RM3,100 in cash aid.

The B40 group with household income of less than RM2,500 are eligible for Rahmah Cash Aid up to RM2,500 depending on the number of their children.

Food baskets and vouchers consisting of staple foods worth RM600 will be extended to Rahmah Cash Aid recipients who are registered under the e-Kasih system.

Youth aged between 18 and 20 also will be given between RM200 and RM400 through e-Wallet credit under the Belia Rahmah e-Tunai initiative.

Razman said Anwar has shown his resolution to end hardcore poverty with the tabling of this budget.

“He (Anwar) wants to ensure all households will be earning a minimum of RM2,000 a month.

“That is one of the intentions that highlights the commitment of this government to help the hardcore poor,” he said.

Under Budget 2023, Anwar allocated RM750 milion for the People’s Income Initiative (IPR), which will empower the poor and increase their income level.

He said about 130,000 of the poorest Malaysians, regardless of race, will be given immediate aid to help lift them out of poverty.

Anwar said that the IPR scheme will enable participants to earn between RM2,000 and RM2,500 a month for two years, after which they are expected to use their earnings to generate future income.

Razman said this budget was not to please every quarter of the public but to close the inequality gap.

“We can see that the focus is different, where it is not necessarily pleasing to everybody. Even the request for EPF withdrawals was not entertained.

“The T20 are being asked to contribute more, by having to pay a higher tax rate,” he said.

Anwar also announced a two per cent cut in individual tax for the RM35,000 to RM100,000 taxable income band, a move that is expected to benefit some 2.4 million taxpayers with disposable income up to RM1,300.

He said while the M40 group would benefit from the tax reduction, the government would raise the tax between 0.5% and two percent for taxable income above RM100,000.

Universiti Tun Abdul Razak economist Prof Dr Barjoyai Bardai expressed his delight at Anwar’s ability to balance out the budget compared to the one made back in October 2022.

“Anwar managed to reduce the deficit from 6% to 5% and increase financial aid and subsidies to specific groups of people such as rubber tappers, fishermen and youth.

“This budget met its goal, the people benefited from it,” he said.

Barjoyai, however, expressed his disappointment at the government for not being able to get more youth to join the Technical and Vocational Education and Training (TVET) programme.

“The 8,000 figure is way too small. I hoped for at least 200,000,” he added.

Madeline Berma, an honorary fellow at Institut Masa Depan Malaysia said the budget was expected.

“It took into account current economic challenge and focuses on addressing the high cost of living, strengthening the social safety net, addressing corruption, enhancing the micro, small and medium enterprises (MSMEs) eco-system, and address issues related to public finances, including exploring new sources of sustainable revenue and minimising leakages,” she told the Malaysian Insight.

The budget, she added, also reflects the government’s commitment to ensuring a sound and sustainable financial position, upholding integrity, enhancing a caring and compassionate society, as well as improving the effectiveness of public and private sector delivery systems.

She also said the budget, in general, was “holistic and inclusive, which emphasises the importance of merging the human component with economic development to ensure a more humane economy.”

The academic said there will be higher taxes for the rich, handouts for the poor and income tax cuts for middle-income earners. –  February 25, 2023.