Tuesday, September 11, 2007

Budget 2008: Hear Zewt

Hmm... there hasn't been much time for me to sit down and write down my thoughts on the disappointing budget in full (that means many many pages...). Sigh. I'll try to do this soon, before the entire interest in the Budget sort of fades away.

But in the mean time, have a look at 2 posts by Zewt:

(1) Clarifying the "tax free" dividend policy
...if you happen to be a shareholder of that company, and so happened your tax bracket is lower than 27%... too bad, you’re screwed. If you’re a pensioner and hold a lot of shares, you’re wonderfully screwed.
(2) and some of his general thoughts on the Budget 2008
The proposal which was supposed to make us all feel very good is that EPF contributors will be allowed to withdraw balances from Account 2 to pay monthly housing instalments. Sounds like a good idea. But if you were to think properly… the government is basically allowing us… to use our own money… to pay for our own house. And we are supposed to feel thankful about it? You tell me…
Enjoy. ;)


Anonymous said...

Retail stock investors will be screwed even further soon:


CKGord said...

Hey guys, check out this patriotic video.

It's pure reflection of Bangsa Malaysia

zewt said...

Hi Tony,

Thanks for mentionin me but I don't think I would like to be quoted by any political party. :)

Those were purely personal opinions.

Anonymous said...

Business Times - 11 Sep 2007

M'sian budget deficit set to soar, not shrink?

KL's forecasts in doubt due to data discrepancy


THE Malaysian Budget tabled in parliament on Friday by Prime Minister Abdullah Badawi has thrown up a poser. Different sets of figures were used for development spending, putting a question mark over the PM's estimate for the budget deficit.

The discrepancy is between figures in the Treasury's Economic Report (2007/2008), read in tandem with the Budget, and Mr Abdullah's actual speech.

In the former, the figure given was RM40 billion (S$17.4 billion), 2.1 per cent lower than the figure in 2007 and indicating a slightly contractionary budget. But in Mr Abdullah's speech, the figure given was RM48.1 billion - a record number and more than 15 per cent higher than in the previous year.

What mystifies economists is that Mr Abdullah maintained, as did the Economic Report, that the federal budget deficit will continue to shrink despite his record figures - from 3.3 per cent of gross domestic product in 2006 to 3.2 per cent in 2007 and 3.1 per cent in 2008.

'That's impossible,' an economist at a Malaysian bank told BT. 'The Economic Report states quite clearly that a deficit of 3,1 per cent would be attained on development spending of RM40 billion and not RM48 billion.'

All other figures in the Economic Report and Mr Abdullah's speech - operating expenditure, overall GDP growth and the deficit - correspond exactly.

Reducing the budget deficit that has been a feature of Malaysia's economy since 1998 has been a priority of Mr Abdullah. His predecessor, Mahathir Mohamad, promised to balance the books by 2005, but although both he and Mr Abdullah cut the deficit from its peak of 5.5 per cent of GDP in 2000, the government does not now seem to consider the matter urgent.

Deputy Prime Minister Najib Razak said recently that the government 'no longer' has a time frame for balancing its books. The main reason: slowing external demand and a greater reliance on consumer and public spending.

In addition, Mr Abdullah's initial spending cuts when he took over as prime minister in late-2003 caused considerable resentment among business, and the resulting pressure forced him to backtrack by early-2005.

Now, there is even greater political pressure on Mr Abdullah to keep the tap of public spending flowing because a general elections is expected to be called next year. So, given his 'new' numbers, the budget deficit is likely to increase next year instead of declining, despite slightly higher estimated growth of 6-6.5 per cent in 2008 compared with 6 per cent in 2007.

What this means is that Malaysia's sovereign credit ratings are unlikely to be raised anytime soon. Malaysia tried to get its ratings lifted this year at meetings with Moody's and Standard and Poor's in New York and Japan. But neither agency agreed. Both expressed satisfaction at the general tone of the economy but reservations over government finances.

Higher credit ratings allow a country to borrow more cheaply abroad.

Unknown said...

Zewt, quoting your opinion on this blog does not automatically align you to any political ideology. Think of your ideas as a source of enlightening other society thoughts.

On a positive side, it may seems EPF is helping the contributor to owning a house but on a negative side, it is a way for EPF to dispose some of the funds to avoid the high holding costs of maintaining the contributor's funds.

Also a point to ponder on why the export duties is higher than the import duties from the government's revenue? Doesn't this means we are discouraging exports?Or does this means we are exporting our raw materials ie. rubber, timber, minerals, oil etc.so much to the effect that the government has to impose export duties to discourage these commodities from losing to other countries for their process?

Anonymous said...

maybe govt trying to boost property sector plus telling us not to keep so much moolah in epf loh...