What I Want From Budget 2013 – A Preview..

Its time of the year again.. Budget 2013 to be presented by the PM this Friday.  Let’s be honest.. not many people really watch the Budget in its entirety.  I’m a trained economist and yet I find the Budget presentation a bore.. hehe.  It does have sentimental value though as my eldest son was born on Budget Day 2000. 

What presented during the Budget does affect our choices in life.  Civil servants hoping for a high bonus, wage-earners dreaming for no tax (yup.. you are allowed to dream) and the public in general hoping for free gifts such as continuous BR1M.  All these influence our choices in life.

OK.. let see what I want from the Budget this time around.  I DREAM of a holistic budget for a change.  This year will be the 3rd time in a row it is called ELECTION BUDGET.  So, I expect this Budget to be pleasing to the eyes of the voters without any ‘tough decisions’ made.  Lots of TRANSFORMASI under the government but I swear I haven’t seen a tough OPTIMUS PRIME in our Budget so far.

So.. what is my DREAM holistic budget? Below are some of them..

1)      Revamp of Tax System

A lot of hoo-ha on the GST but I just wonder whether the govt has take a look at the whole tax system.  The govt’s revenue still relies on direct revenue (a large chunk from Petronas’ generous dividend).  Therefore, the GST need to be introduced (but I doubt it will be in this Budget since it is not voters-friendly) although it must be accompanied by assistance to the poor and middle-income.  The govt should have introduced GST and BR1M simultaneously to balance out any negative impact of GST. 

2)      Focus on Implementation Rather Than Allocation

Every year certain amount is allocated for this and that.. I wonder whether those allocations reach the targeted people or not.  For example, every year huge allocations are made to SMEs but my clients and many other SMEs always complaining about difficulty in accessing these funds.  There is no point of making huge allocations but the implementation or distribution mechanism is still at “ice-age” level.

3)      Incentive for Private VCs and Angel Investors

Sources of funding for SMEs in Malaysia are limited to financial institutions, govt funds and VCs.  Unfortunately, existing VCs are largely funded by govt and thus, the process is sometimes tedious and not up-to-date (as I mentioned in number 2 above).  There are many individuals out there with plenty of cash who are willing to invest in new businesses provided that certain incentives are given to minimise their risk. 

4)      Allow Small Banks to Operate

There is lack of focus from existing banks on SMEs.  Partly it can be blame on banking mergers in the last decade, creating huge banks which directly lead to entertaining huge clients.  I believe allowing private small banks catering for specific niche market will allow easier access for SMEs via more creative products.

I am waiting for PR’s alternative Budget scheduled tomorrow.  PR’s Budget is always populist but in the past, it has shown some creativity in certain areas which the govt’s Budget is lacking.  Will review it once it is presented, Insha’Allah.

Before I end this RANTING.. don’t you think the BUDGET sounds nicer in Malay as BELANJAWAN instead of English-adopting BAJET?.. hmm..