The finance minister says expansionary measures are necessary to provide fiscal contingency amid an uncertain global economic environment
By SHAZNI ONG / Pic By ARIF KARTONO
THE government is not likely to introduce new tax measures for the corporate and investment sectors in the upcoming Budget 2020, as it seeks to prioritise towards sustainable economic growth.
Finance Minister Lim Guan Eng said such expansionary measures may be necessary to provide some fiscal contingency, amid an uncertain global economic environment as a result of trade dispute between the US and China.
“Looking ahead to the 2020 Budget, while we do not foresee any new tax measures on the corporate sector and investment community, the government will have to seek fiscal space to prioritise sustainable economic growth,” Lim said in his speech at the opening of Menara Prudential’s new head office at the Tun Razak Exchange (TRX) yesterday.
“Malaysia advocates a continuation of a multilateral approach to achieve free and fair trade, productivity growth, embrace of a digital economy, and a rise in incomes to increase purchasing power and profitability of workers and businesses,” he added.
Speaking to reporters at the press conference, Lim said the government is willing to adopt expansionary budgetary measures, to provide fiscal room to sustain economic growth.
“That is why we say that we will prioritise economic growth,” Lim said adding that discussions with various parties for the budget are still ongoing.
Separately, Lim said the government and Bank Negara Malaysia (BNM) are taking every effort to realise the national agenda for the national insurance penetration rate to reach 75% in 2020.
According to BNM, less than 41% of Malaysians own at least one individual or group life insurance policy, or family takaful — while almost half of all Malaysians are uninsured, with a life insurance penetration rate of 55% that has been stagnant for years, he said.
“This is where insurance can play a bigger role in improving financial literacy and building resilience among Malaysians.
“Insurance providers, including Prudential, should also further develop protection plans for the under served and under-protected who are largely from the low-income group of the B40.
“This includes providing Malaysians with more diversified and affordable choices,” he said.
Lim does not rule out the possibility of revising the insurance penetration rate target, based on the penetration rate achieved next year.
“We will have to see what will be the outcome next year. After that, we will do assessment in terms of the penetration, the shortfalls, what more needs to be done.”
“I think the question is again on pricing and affordability. Knowing the penetration rate is far below the desired target, we have introduced MySalam — a free protection policy catering to the B40 group,” he said further.
Earlier, Prudential Financial Inc celebrated the opening of its corporate head office, marking a major milestone for the company in the country.
Developed by IJM Corp Bhd, the new Menara Prudential houses more than 2,000 employees from all five of its businesses — namely Prudential Assurance Malaysia Bhd, Prudential BSN Takaful Bhd, Eastspring Investments Bhd, Eastspring Al-Wara’ Investment Bhd and Prudential Services Asia Sdn Bhd.
Prudential Assurance Malaysia CEO Gan Leong Hin said the company is proud to be the first to move into the world-class TRX district.
“Malaysia is the longest operating market for Prudential in Asia, where we have been serving for more than 95 years, and our new office is a testament to our commitment to the community,” he said.
The 27-storey Menara Prudential is Grade A, LEED Gold and MSC certified, featuring resource-saving measures such as rainwater harvesting and recycling.