PUTRAJAYA should have included more perks in Budget 2024 to encourage domestic growth amid an uncertain economy, Prof Chung Tin Fah at HELP University said.

He said it was especially crucial to incentivise growth in the tourism, construction and property sectors.   

“More funding is needed to promote tourism in Malaysia,” he told The Malaysian Insight. 

“Given a difficult and uncertain economic environment, tourism is the key sector to promote growth amid a weak ringgit and the world-class infrastructure of Malaysia.”

He said RM90 billion for development placed the focus on tax breaks and incentives for the consumer rather than the investor.

Prime Minister Anwar Ibrahim yesterday unveiled Malaysia’s biggest-ever budget of RM393.8 billion. 

Anwar said Visit Malaysia Year 2026 targets 26.1 million foreign tourist arrivals and RM97.6 billion in receipts.

“The government will introduce new initiatives under the Visa Liberalisation Plan.”

He said these include better visa-on-arrival facilities and multiple-entry visas to draw tourists and investors, especially those from India and China.

Anwar said Putrajaya will relax the conditions for Malaysia My Second Home applications to attract more tourists and investors.

Chung said there were no tax breaks or strategies to promote employment and economic growth. 

“The B40 are protected by rationalisation for the subsidy removal while the M40 and T20 are affected.  

“What the government saves is at the expense of this group of consumers.”  

He said the Rahmah cash aid will marginally offset the high costs of living for low-income earners but a weak ringgit and the removal of subsidies could cause inflation to rise.

“It is a balancing act to reduce subsidies and increase tax on non-essentials such as luxury goods.

“The costs of raw materials and utilities will increase for companies though this is moderated by a phased approach rather than a one-off increase.”

He said the national spending plan is neither business friendly nor pro-growth budget as its emphasise is on rationalising taxes and normalising subsidies. 

“There are no measures to encourage growth in domestic demand. Investment is not addressed. Domestic demand is expected to spearhead growth of 4-5%. Can this be achieved?”

The budget offers no goodies but removes subsidies and raises the service tax to 8%, he said, making it “more of a wake-up call to tighten one’s belt”.

Selangor government think tank Institut Darul Ehsan researcher Khairul Arifin Mohd Munir said the budget shows the prime minister is managing the economy. 

“The budget is organised by strengthening three main focuses, which are good governance and integrity, economic restructuring, and wellbeing of the people,” he said in a statement. 

Khairul pointed to the targeted subsidies, new schemes and modification of existing policies to empower the people who are the core of the civil economy policy and the 12th Malaysian Plan. 

“The Public Finance and Fiscal Responsibility Bill 2023 or Fiscal Responsibility Act should be welcome. 

“This will provide a positive impact and value in strengthening the government’s commitment in transparency and accountability.” – October 14, 2023.