BUDGET 2022: What captains of industry say about the budget

This article first appeared in The Edge Malaysia Weekly, on November 1, 2021 - November 07, 2021.
BUDGET 2022: What captains of industry say about the budget
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Datuk Abdul Rahman Ahmad

Group CEO, CIMB Group Holdings Bhd

We welcome the government’s plans for sustainability sukuk issuance amounting to up to RM10 billion in the year ahead to be channelled to qualified social and climate-friendly projects. This is to follow the successful issuance of its dual-tranche US$1.3 billion Sukuk Wakala offering this year, where the offering’s US$800 million tranche was the world’s first US dollar sustainability sukuk offered by a sovereign.

As the country continues to grapple with the impact of the prolonged pandemic, we are pleased to see the focus on initiatives that will benefit the bottom-40% group and businesses, especially micro, small and medium enterprises (MSMEs), the backbone of our economy.


Datuk Ong Eng Bin

CEO, OCBC Bank (Malaysia) Bhd

Budget 2022 is aimed at rebuilding Malaysia steadily as we recover from the pandemic. It rightly focuses on helping individuals and businesses regain their footing by continuing to provide support even as the economy improves. This remains necessary as they still need considerable help. The government’s initiatives on addressing climate change issues and other sustainability-related measures are timely and I am glad that the banking sector remains in a position to play its key role in the rebuilding efforts. There is every reason to be optimistic about the future as the building blocks are in place.


Tan Sri Datuk Seri Dr Teh Hong Piow

Founder, Chairman Emeritus, director and adviser, Public Bank Bhd

The government’s ongoing initiatives in providing support by way of subsidies, grants and various other measures of assistance totalling RM31 billion are laudable. We applaud Budget 2022, which appropriately balances the mix between reducing income inequality, expanding targeted assistance to households and businesses while also investing in the nation’s healthcare and basic infrastructure.

Specific measures include allocating RM8.2 billion to the newly introduced Bantuan Keluarga Malaysia programme, which will benefit 9.6 million recipients, and the RM4.8 billion set aside to create 600,000 employment opportunities. The government’s allocation of RM30 million to provide internet access to 40 low-cost housing schemes and RM700 million towards ensuring digital connectivity in 47 industrial areas and 630 schools in rural areas is very much welcomed.


Datuk Seri Eric Kuan Khian Leng

Secretary-General, Master Builders Association Malaysia (MBAM)

MBAM thanks the government for some of the construction projects announced but in reality they are insufficient for the industry at large. Most of the projects announced are smaller-scale projects to enhance the infrastructure for public use. These would benefit part of the industry players, mainly those in the G1 to G4 (small grade contractors). However, MBAM was expecting a more uplifting Budget 2022 announcement for the construction industry. Disappointingly, there was no announcement of new mega infrastructure projects to pump-prime the construction industry. MBAM appeals to the government to provide more assistance for the construction industry.


Sim Kwang Gek

Tax leader, Deloitte Malaysia (Deloitte Tax Services Sdn Bhd)

Instead of introducing a windfall tax on companies that benefitted from the pandemic and enjoyed super profits, Budget 2022 proposes a one-off 33% tax on taxable profits above RM100 million. This is an increase of 9% compared with the current headline tax of 24%. This measure should be easier to implement compared with the proposal to impose a windfall profit levy on certain sectors where market price may be lacking. It also covers all businesses that have prospered from the pandemic. [The amount of] tax revenue which can be generated from this measure remains to be seen as there may not be many companies with taxable profits (which is net of deductible expenses and allowances) above RM100 million.


Datuk Ir Soam Heng Choon

President, Real Estate and Housing Developers’ Association Malaysia (Rehda)

The further allocation of RM1.5 billion to continue with housing programmes, such as the development of Rumah Mesra Rakyat and maintenance of the public housing units, is a step in the right direction. Similarly, the RM2 billion guarantee given to banks through the Guaranteed Credit Housing Scheme (Skim Jaminan Kredit Perumahan) to assist those in the gig economy and alike, with the ability to pay, but without income statements, is a welcome move. This will hopefully encourage more from the group to purchase a home as they now have easier access to home financing.


Datuk Abdul Farid Alias

Group president and CEO, Maybank Banking Bhd

We welcome the expansion in housing credit guarantee and micro credit schemes to workers and businesses in the informal sectors, specifically aimed at facilitating access to financing and enabling financial inclusion.

The banking industry, together with Agensi Kaunseling dan Pengurusan Kredit (AKPK), has also developed its own targeted programme to continue supporting the most vulnerable segment of individual customers through a comprehensive extended financial assistance scheme. This scheme, known as Financial Management and Resilience Programme (Programme Pengurusan Ketahanan, or Urus) will provide holistic financial management solutions for B50 customers.


Datuk Khairussaleh Ramli

Group managing director and CEO, RHB Bank Bhd

There continues to be much focus on accelerating the economy with higher allocations for small-scale projects, as well as supporting the growth of SMEs. The focus on consumer discretionary spending, coupled with the higher allocation for development as well as capital expenditure by the non-financial public corporations (NFPC), will be positive for the infrastructure-related segment of the economy. This will result in large multiplier effects on economic activity.


Jagdev Singh

Tax leader, PwC Malaysia

Budget 2022 continues to drive certain popular measures, such as the extension of the RM2,500 tax relief for smart devices, computers and tablets. It also recognises the growing trend of Malaysians going into the gig economy, by increasing tax relief for EPF contribution by gig workers to RM4,000.

To further alleviate the burden of the rakyat, other smaller measures include increasing the tax relief for Socso from RM250 to RM350, and expanding the relief to include the Employment Insurance System (EIS).

For SMEs, there will be an increased allocation for the digitalisation grant scheme, and enhanced access to funding for targeted sectors, such as the halal, aerospace and green energy industries.


Tan Sri Nor Mohamed Yakcop

Chairman, Khazanah Research Institute

The government’s commitment to job creation through Budget 2022 can be noted in several programmes, including JaminKerja and the Malaysia Short-term Employment Programme (MySTEP). This will be especially positive for the most impacted groups, such as the youth, unemployed graduates and workers in the informal sector. Social protection has been given a boost with the expansion of the coverage to informal sector workers and housewives.

The government’s financial support for SMEs totalling RM14.2 billion through various financing schemes and business support will be key in bringing about recovery in the economy.


Datuk Amirul Feisal Wan Zahir

Managing director, Khazanah Nasional Bhd

In line with the 12th Malaysia Plan, Budget 2022 is a comprehensive approach in driving a strong and sustainable recovery of the economy while providing broad socioeconomic inclusivity and social protections.

This can be seen via the priority placed on healthcare and education infrastructure on the one hand, and on investments in digital infrastructure and digital connectivity on the other. This approach will help ensure that the entire Keluarga Malaysia, from individual citizens to business entities, emerges stronger together.


Datuk Sulaiman Mohd Tahir

Group CEO, AMMB Holdings Bhd

As an SME-focused bank, we are conscious of the imperative need for SMEs to accelerate adoption of digitalisation. To this end, the government’s allocation of RM45 million for the transformation towards Industry4WRD is timely and necessary.


Datuk Charon Mokhzani

Group MD, MIDF Bhd

Budget 2022 will help us recover from the effects of the pandemic and set us on the right path towards long-term growth. We welcome the cash aid to those in need as well the focus on education and children. The government has maintained a balance between investing for the future, such as in technology, and enhancing technical and vocational education and training, while providing aid to those who have been badly affected by the pandemic.


Farah Rosley

Malaysia Tax Markets leader, Ernst & Young Tax Consultants Sdn Bhd

It was proposed that starting from Jan 1, 2022, foreign-sourced income earned by Malaysian tax residents and received in Malaysia will no longer be tax- exempt. This is a revenue-raising measure and would also help remove Malaysia from the European Union’s list of non-cooperative jurisdictions (the so-called “grey list”). However, care should be taken to ensure that this move does not discourage the remittance of funds back into Malaysia. It is hoped that a transitional period will be provided and the government should consider directing this proposal at corporates and not individuals.


Nik Amlizan Mohamed

CEO, Kumpulan Wang Persaraan Diperbadankan (KWAP)

As a major investor in corporate Malaysia, we are inspired by environmental, social and governance (ESG) criteria taking centre stage to ensure that companies step up to achieve best practices in this sphere. Within the ambit of ESG and promotion of inclusivity, it is laudable that Bursa Malaysia-listed companies will be required to appoint at least one woman to their board of directors.


Tai Lai Kok

Head of tax, KPMG Malaysia

The one-off cukai makmur tax announced is not targeted at any specific sector but rather at non-SME companies that have chargeable income in excess of RM100 million. While the first RM100 million will still be taxed at the standard 24% tax rate, any excess will be taxed at a rate of 33%.

While some may argue that such a tax is a concern to large corporate taxpayers, the fact that it has been announced as a one-off tax for Year of Assessment 2022 should not result in a significant change in mood for investors and businesses alike. That said, it is absolutely critical that the government keeps to its word that it is really a “one-off tax” during this time of need.


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