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KUCHING, Nov 7: Kuching Chinese General Chamber of Commerce and Industry (KCGCCI) secretary-general Jonathan Chai Voon Tok expressed grave concern that the targeted Employees Provident Fund (EPF) Account 1 withdrawal facility of RM500 per month measure proposed in the National Budget 2021 will deplete people’s savings for the future.
This measure coupled with an anticipated drop in the savings in EPF of the employees as their minimum EPF contribution will be reduced to 9 per cent from 11 per cent starting from January 2021, Chai said could further dwindle people’s savings for retirement.
“As it is, studies have shown that the majority of the contributors do not have enough EPF savings for their retirement and such ‘convenience’ provided in this budget would exacerbate the dilemma,” he said in a statement today.
As for the reduction in personal income tax by one per cent for those earning RM50,001 to RM70,000, Chai however viewed that the extent of revision seemed insignificant.
“I would have hoped for a bigger adjustment on the rates of the personal income tax as well as a reduction in the rate of the corporate tax too to ease the cash flow of the businesses to help to fight the outbreak of the pandemic,” he shared.
Chai also expressed disappointment that there seemed to be insufficient aid given to small and medium enterprises (SMEs) even though the sector is the backbone of the country’s economy and also the major contributor of job opportunities in the private sector.
For targeted recovery assistance facilities worth RM2 billion under Bank Negara Malaysia (BNM) to be made available through loans from banking institutions, he said finer details relating to the application of such loans needed to be elaborated.
On the budget of RM725 million to be provided for upgrading 50 dilapidated schools in Sabah and Sarawak in 2021, he pointed out that the sum was not substantial but at least there was a commitment on the part of the federal government in resolving the long outstanding issue of dilapidated schools in both states.
Having said that, Chai, who is also the Association of the Boards of Management of Aided Chinese Primary Schools in Kuching, Samarahan and Serian Division president, expressed worries that Chinese schools in Sarawak would encounter funding problems for the repair and maintenance of their facilities.
“There’s no specific allocation provided in the budget unlike previous years even though RM800 million has been set aside for serving and repairing of the government schools and government-aided schools.
“The distribution of such a budget for the schools concerned remains unclear and uncertain,” he added.
Overall, Chai was however glad that Sarawak will receive RM4.5 billion in development expenditure for infrastructure development including water, electricity, roads, health and education facilities while the construction of the Pan Borneo Highway will continue to receive the necessary funding.
As the RM322.5 billion budget for next year will be the largest allocation in the nation’s history, he agreed that it was much needed in the midst of the unprecedented Covid-19 pandemic and economic crisis to preserve the welfare of the people and to improve the country’s economic resilience.
“As expected, the main focus of this budget is centred around fighting the pandemic and the government has proposed to raise the ceiling of the Covid-19 Fund by RM20 billion to RM65 billion to finance the Kita Prihatin package and other additional aid relating to the pandemic,” he said.
Other measures well received in the budget, Chai added was the extension of Wage Subsidy Programme to the employees in the tourism sector for another three months and that workers earning RM4,000 and below will receive RM600 per month for another three months.
“To encourage home ownership, the government will also implement several initiatives including a full stamp duty exemption on the instruments of transfer and loan agreements for the purchase of the first homes worth up to RM500,000.
“Hopefully, such initiatives would boost the sale of the houses which have been adversely affected under the prevailing deteriorating economy,” he added. — DayakDaily