Government spending on subsidies, aid and incentives takes up the biggest portion of the federal budget.

PETALING JAYA:

The education and health ministries received the biggest allocations under the RM388.1 billion Budget 2023, with RM64 billion set aside for government subsidies, aid and incentives.

Here are the 10 key highlights of the national budget as announced by Prime Minister Anwar Ibrahim earlier today.

1. The education ministry has received a RM55.2 billion allocation, the largest of any ministry. A total of RM777 million has been set aside for the supplementary food programme benefitting 700,000 schoolchildren.

2. The health ministry has been allocated RM36.3 billion. This includes nearly RM3 billion for the appointment of over 1,500 permanent and contract health workers.

3. A total of RM64 billion has been allocated for subsidies, aid and incentives. In addition, RM8 billion has been earmarked for cash aid under Sumbangan Tunai Rahmah which will benefit 8.7 million people. The poorest will receive up to RM3,100.

4. The home and defence ministries will get a combined RM36.2 billion. This includes RM4.1 billion for the maintenance and purchase of new military equipment and nearly RM1 billion to improve domestic security, including the purchase of 2,100 body cameras for policemen.

5. More than RM70 billion in loan facilities will be available for SMEs and MSMEs through Bank Negara Malaysia and other government agencies.

6. The government will study the possibility of introducing a capital gains tax from 2024. It will also introduce a luxury goods tax.

7. Income tax for those earning between RM100,000 to RM1 million a year will be increased by 0.5% to 2%. Meanwhile, income tax has been reduced by 2% for those earning between RM35,000 to RM100,000. This will benefit 2.4 million taxpayers.

8. Sabah will get RM6.5 billion in development funds while Sarawak is to get RM5.6 billion, a minor increase from the budget proposals originally tabled but not approved in October last year.

9. The government will review the terms of the MRT3 light rail project in the Klang Valley, with the aim of bringing the project’s cost down from around RM50 billion to below RM45 billion.

10. The government will contribute RM500 to EPF Account 1 of members aged 40 to 54 with less than RM10,000. This will benefit two million people and cost Putrajaya RM1 billion.

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Largest budget share for subsidies and aid, education, health

RM64 billion is allocated for government subsidies, aid and incentives while the education ministry once again received the largest allocation with RM55.2 billion.