by WONG CHUN WAI

PUTRAJAYA: A home for every Malaysian – that will be the main agenda for Budget 2008 that will be unveiled by Prime Minister Datuk Seri Abdullah Ahmad Badawi at the Dewan Rakyat today.

A home-financing scheme is expected to be announced to allow wider house ownership.

It is regarded as the Government’s commitment to ease the housing burden of Malaysians, especially for the lower and middle-income groups.

Treasury officials have remained tight-lipped over the details of the initiative, regarded as the biggest Merdeka gift for the people.

The home-financing scheme could possibly be made through monthly deductions through the Employees Provident Fund.

In a further boost for house buyers, Abdullah, who is also the Finance Minister, is likely to announce further reductions for stamp duties, which made up a substantial amount of expenses for buyers.

Sources said the Government was aware that owning a house was a necessity for the rakyat and it should not be a burden, as paying housing loan instalments made up the largest portion of a person’s monthly budget.

A source described the mechanism as “interesting and broad based” which would make it easier for “those wanting to buy their first house or already owning one.”

There is further good news – Abdullah is also expected to announce details of how the self-employed who may not have EPF contributions or those with inadequate financial records such as salary slips to prove their repayment ability can get housing loans.

Officials have downplayed suggestions that the Budget would be perceived as a general election budget, saying the Government had always ensured that every Budget would help the people.

The broad framework of the Budget essentially covers three areas:

  • IMPROVING the quality of life;
  • TO make common consumer items affordable and not a burden to the lower-income group; and
  • BEEFING up the police force to fight crime, a major concern of Malaysians. In his Economic Report 2007/2008 to be released today, Abdullah is expected to reaffirm the Government’s social agenda as a key component in the formulation of economic policies.

    He is expected to emphasise that the ultimate measure of economic success would be the achievement of higher living standards and improved well-being of the people.

    Abdullah is likely to announce a huge allocation for the police force to purchase crime prevention equipment to make their policing more effective. Sources said the Government wanted to make the police make “more visible.”

    Human capital development is almost certain to be given attention in the Prime Minister’s speech with an undertaking to further review and realign the education system.

    Smokers and drinkers could possibly get a reprieve this time as the Government had recently raised excise duties, and it would be unlikely that sin taxes would be imposed again.

    Officials have not given any indication of reductions in individual tax, where the current top rate is 28 %, but have hinted of further rebates, including moves to encourage “healthy living”.

    The Government is also expected to put on hold the proposal to re-introduce the goods and services tax (GST), saying the timing was unsuitable.

    Analysts say that any introduction of this tax, which was supposed to come on stream in January this year, would burden consumers which would be unfriendly with the general election, expected to be held by early next year.

    On corporate tax, it is almost certain that Abdullah would announce another 1% cut, from 27% to 26%. Analysts said the figure might seem insignificant but the move may cost the Government up to RM400mil in revenue.

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