The presentation of the national budget in Parliament (Budget Malaysia) has become a highly anticipated event in Malaysia each year.
Malaysians look forward to the designated day to learn about the government’s plans for the upcoming year, including strategies to enhance economic standards, the initiatives, and, most importantly, what benefits will the government provide to the public?
This year, Prime Minister Datuk Seri Anwar Ibrahim will announce the budget at the Dewan Rakyat on Friday, 18th October, 2024.
But early insights into what we can expect from the Budget 2025 have already begun to emerge.
According to Anwar, the Budget 2025 for Malaysia will concentrate on three key areas, which reflect the theme “Ekonomi MADANI Negara Makmur, Rakyat Sejahtera,” :
Raise the Ceiling: To enhance Malaysia’s economic standing
Raise the Floor: To enhance the quality of life for all Malaysians
Good Governance and Public Sector Reform: To strengthening accountability, transparency, and efficiency in governance to build public trust
So, what does the future hold for the people of Malaysia?
As mentioned, significant planning efforts are already underway, sparking discussions among Malaysians. Let’s take a look:
Pre-Budget 2025 Malaysia:
1. Real Estate Focuses
i. Deposit MADANI To Help More Malaysians Buy Homes
Good news for first-time homebuyers!
The Ministry of Housing and Local Government (KPKT) has introduced the Deposit MADANI initiative to assist more Malaysians in purchasing homes, according to the Real Estate and Housing Developers’ Association Malaysia (Rehda).
Rehda President, Datuk Ir Ho Hon Sang, mentioned that this proposal fits with Rehda’s goal of promoting a 10 percent deposit for home purchases.
This requirement has been a major hurdle for those without enough savings, particularly young individuals who just started their careers.
The MADANI Deposit program aims to offer deposits of up to RM30,000 for first-time homebuyers, supporting the government’s ‘Rumahku, Syurgaku’ initiative.
Alongside the Deposit MADANI, other plans include creating 100 MADANI Recreational Parks, improving retention ponds, implementing electronic sale and purchase agreements, and e-stamping to boost the community’s well-being.
All of these are in line with digital transformation and Malaysia MADANI goals.
ii. Johor-Singapore Special Economic Zone
If you’re residing in Johor and considering investing property in Singapore, it may be wise to begin your planning soon!
Prime Minister Datuk Seri Anwar Ibrahim, who also serves as Finance Minister, has highlighted that the Johor-Singapore Special Economic Zone (JS-SEZ) will create a wealth of opportunities for local residents, as the state aspires to be the gateway to ASEAN.
Johor’s close relationship with Singapore increases its attractiveness as a key location for foreign investments and high-paying job opportunities.
Additionally, the construction of the RTS Link (Rapid Transit System Link) has significantly stimulated the market, drawing interest from both locals and foreigners looking to invest in these two prominent towns.
Additionally, the JS-SEZ is expected to serve as a catalyst for advancing digital economic growth, fostering technological innovation, and promoting sustainable development in the green sector.
2. Five New Taxes
Like it or not, five new taxes will be introduced. These are the Fatty Foods Tax, Carbon Pricing Tax, Inheritance Tax, High Value Goods Tax, and Artificial Intelligence (AI) Tax.
These taxes aim to encourage healthier living and sustainable practices. It’s best for you to start cutting down on those junk foods.
3. No SST for TNG eWallet
No more SST for TNG eWallet users? We say it’s plausible.
TNG Digital is asking the government to keep the Sales and Services Tax (SST) exemption for digital services, as they believe this is important to keep these services affordable.
Especially for low-income groups like B40 and M40, as well as small businesses.
To help with the increasing cost of living, TNG Digital also suggested that financial support programs, like ‘Sumbangan Tunai Rahmah’ and ‘Bantuan Awal Persekolahan’, should be given through e-wallets.
This would make it easier for people to receive the help they need.
Though no confirmation has been made by the government on the proposed plan, we say it is highly possible for the government to approve this issue.
4. Reimplement GST?
The return of GST should be now or never, said analysts.
CGS International Securities Malaysia thinks that GST can help solve many of the government’s money issues.
They also predict that government debt will stay high at 62 % of GDP this year, which is near the 65% debt limit.
However, in September, Anwar mentioned that there had been no discussions about this, so the topic of GST was not addressed.
5. RON95 Subsidy Will Be Revised
CIMB Securities Research said that although there isn’t much information about the RON95 Subsidy, the government’s plans for this and the promotion of Electric Vehicles (EVs) could greatly impact the total industry volume (TIV) demand in the automotive sector for 2025.
At the same time, CIMB Securities Research predicts a decline in total industry volume (TIV) in the last quarter of 2024 (4Q24) because the government plans to adjust fuel subsidies.
However, they noted that the launch of the Employees’ Provident Fund Account 3 and salary increases for civil servants could help boost new vehicle sales.
For this, Anwar noted that while the prices of goods such as edible oil, petrol and flour are relatively cheaper in Malaysia compared to regional peers, there remains a need to focus on improving income levels—first and foremost.
Govt’ To Focus On Boosting Wages
Overall, Anwar has stated that the main goal for Budget 2025 Malaysia is to tackle inflation and improve wages.
“The level of income has not increased, (amid) an increase in productivity or investments. We must address this issue,” said the Prime Minister.
As discussions around the 2025 Budget for Malaysia intensify, we find ourselves asking: Can Malaysia finally tackle inflation?
Or will it inadvertently create an additional challenge for Malaysians facing an already high cost of living?
Submit Your Suggestions
However, I think we can all agree that 2025 Budget will mark a pivotal moment for the nation’s economic development, with the government expected to provide substantial assistance to the people, especially in real estate industry.
While we wait for the budget announcement, we are eager to see how it could positively affect the real estate sector and other important industries, leading to progress and growth.
The Budget 2025 Malaysia is set to be tabled on Friday, 18th October, 2024.
Shall you have any suggestion or inquiry, feel free to submit them here.
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