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1) Enhancing Highly Skilled Human Capital
1.1) Expanding Access to Quality and Affordable Education
RM30bil will be allocated to primary and secondary school education, where:
-RM19bil for emoluments
-RM2.8bil for student assistance and scholarship program
-RM1.6bil for schools construction (where RM1.1bil for refurbish).
Besides, 4 NKRA will be focused, which are namely:
a) Strengthening pre-school education – RM48mil will be provided in 2010.
b) Increasing literacy and numeracy rate – RM32mil allocated and all 2010 year 1 school children will be involved.
c) Creating high performance school – RM20mil allocated to target 20 schools to be recognized as SBT in 2010.
d) Recognizing school principles and head teachers – Monetary or non-monetary incentives will be awarded to head teachers and principles who achieve target performance.
1.2) Safeguarding Welfare of Student
a) Award national scholarship to 30 crème de la crème students.
b) Convert PTPTN to scholarship for those who graduate with 1st class honors degree or equivalent started at 2010.
c) Provide 50% discount on KTMB long distance fares for student aged 13 and above, commence at 2010.
d) Netbook package cost RM50 per month for 2 years offered to 100000 local university students by Telekom, commence 2010.
1.3) Enhancing Skills of the Workforce
a) RM1.3bil for polytechnics and community colleges.
b) RM504mil for Industrial Training Institutes and Advanced Technology Training Centre.
c) RM438mil for Institut Kemahiran MARA, Kolej Kemahiran Tinggi MARA, Institut Kemahiran Belia Negara, and Institut Kemahiran Tinggi Belia Negara.
d) RM 110mil for state skills development centres and selected training institutions.
e) Accredit SKM level 4 and above as equivalent to the academic stream.
1.4) Expanding PERMATA program
-RM100mil allocated to implement related programs.
1.5) Strengthening Public Higher Education Institutions
-Government will consider relaxing the rules and regulations on hindering IPTA from generating their own income.
2) Strengthening Banking and Financial System
-A new motor basic insurance and takaful scheme will be offered and expected to be introduced by the mid of 2010.
-Micro insurance and takaful coverage will be expanded for small businesses, small scale businessmen will benefit from coverage ranging RM10000-RM20000, with a premium of RM20 per month.
-Government will review, improve, and enforce Anti-Money Laundering Act and Anti Terrorism Financing Act 2001.
2.1) Invigorating the Stock Market
a) First stage of allowing brokerage sharing at a minimum rate of 40% for remisier which takes effectively, and second stage of fully liberalized commission-sharing will be effective 1 Jan 2011.
b) Allow 100% foreign equity participation in corporate finance and financial planning companies compared at least 30% local equity before.
c) All PLC required offering e-Dividend, and stockbroker will offer e-Dividend option too.
2.2) Further Developing Islamic Finance System.
Government proposes existing tax incentives be extended to 2015 in financial services especially for Islamic finance. Scope will be extended:
a) Stamp duty exemption of 20% on Islamic financing instrument.
b) Tax exemption on banking profits derived from overseas operations, and also extended to profits of insurance and takaful company which derived from overseas operations.
c) Double deduction on expenditure incurred in promoting Malaysia Islamic
Finance.
d) Deduction on expenditure incurred on the issuance of Islamic securities approved by SC and LOFSA.
e) The tax treatment accorded to SPV established under the Companies Act 1965 is extended to SPV established under Offshore Companies Act 1990 electing to be taxed under the Income Tax Act 1967.
f) Tax exemption on profits received by non-Ringgit Sukuk approved by SC extended to Sukuk approved by LOFSA.
2.3) Ar-Rahnu Micro Credit Program
Government will encourage all syariah-compliant financial and banking institutions to offer this scheme.
3) Combating Corruption
a) Formulate a Whistle Blower Act to encourage corruption disclosure and will be introduced in 2010.
b) Establish 14 Special Corruption Session Courts and 4 Special Anti-Corruption Commission Appeal High Courts.
c) Enhance Malaysia image in anti-corruption.
4) Development of Regional Economic Corridors.
-RM3.5bil will be allocated by Government in Regional Economic Coridors.
4.1) Developing Putrajaya and Cyberjaya
Efforts will be intensified to increase business, commercial and recreational activities.
5) Improving Effectiveness and Efficiency of Government Administration
5.1) Strengthening Management of Government Finance
-If to implement GST, it will replace the current sales and service tax as well as exemption will be given to the low income group.
-Government proposes that upstream petroleum companies income tax for year of assessment 2010 based on income derived from 2009 be allowed to pay in installments within 5 years.
-Government proposes that a tax of 5% be imposed on gains from the disposal of real property from 1 Jan 2010. But the existing tax exemption will be retained for gifts between close relatives. This exemption will be given on disposal of a residential property once a lifetime.
-Government proposes RM50 service tax per year imposed on each principle credit card and charge card, included those issued free of charge, and also RM25 service tax on each supplementary card, effective 1 Jan 2010.
-Government will impose a sum of RM10000 for each AP to open AP holders, effective 1 Jan 2010.
-Government allows government agencies to rent out certain assets and retain 50% of rentals received while the 50% shall be remitted to the Government as revenues, effective 1 Jan 2010.
-Government has identified assets (lands and buildings) which can be jointly developed or sold to GLC.
5.2) Restructuring of Fuel Subsidy Scheme
-To benefit only targeted groups, Government will implement a fuel subsidy management system in early 2010 as well as other commodities.
5.3) Intensifying Government Delivery System
-Civil servants with monthly household income from RM2000-RM3000 are qualified for the RM180 monthly pre-school fee subsidy. An allocation of RM200000 will be made available for every Ministry and Government department to establish day-care centre.
5.4) Individual Income Tax
-Government proposes income tax rate reduced to 26% effective from the year of assessment 2010, as well as cooperatives and non-resident individual’s tax rate.
-Government proposes personal relief be increased from RM8000 to RM9000, effective from the year of assessment 2010.
-Government proposes income tax on employment income of Malaysians and foreign knowledge workers residing and working in Iskandar Malaysia be imposed at a rate of 15% only.
*Adapted from Malaysia Budget 2010 Speech by Prime Minister Najib.
Glossary
NKRA: National Key Result Areas
KEMAS: Jabatan Kemajuan Masyarakat
SBT: Skim Bantuan Tuisyen
Crème de la crème: French word, which means the very best.
KTMB: Keretapi Tanah Melayu Berhad
SKM: Sijil Kemahiran Malaysia
PERMATA: Program Pendidikan dan Pengasuhan Kanak-kanak
PLC: Public Listed Company
SC: Securities Commission
LOFSA: Labuan Offshore Financial Services Authority
SPV: Special Purpose Vehicle
GST: Goods and Services Tax
AP: Approved Permit
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