Saturday, October 16, 2010

Malaysia 2011 Budget – Personal Finance Highlights

If you’re Malaysian and you probably have already known about this Malaysia 2011 budget announcement. Well, what should you react from your personal finance perspective? Let’s see some of the highlights which I think may be important to you.

Note: You may also interested in Malaysia 2010 Budget and see what could do out of it if you’re not aware of it…


(1) Flat Toll Rate Until 2015 for PLUS owned highways

This is at least good news for me and also for those who travel often through the PLUS highways. Hopefully we’re all still here until 2015, I’m quite sure we’re. Hahaha…


(2) 50% Stamp Duty Discount and Full Loan for First-Time House Buyers

This is not applicable to me as I am no longer a first-time house buyers. :( Basically you will be entitled for this 50% stamp duty discount if you purchase house within RM350K.This is Eligible for S&P/SPA executed from 1 Jan 2011 to 31 Dec 2012. Also, if your family income is less than RM3K per month, you do not need to pay 10% down payment too. You can get 100% loan for the houses priced below RM220K. Well, this is not applicable to me again.

[Update:17 Oct 2010]
In case you do not aware, previously we already have this 50% exemption discount on stamp duty but only for your house that not exceeding RM250K. The discount is until 31 Dec 2010. Now it seems like they increase to RM350K but ONLY for first time house buyers.

[Update:19 Oct 2010]
 I don't recommend for those who can NOT afford to buy a house to take up the 100% loan. If you can't effort, don't buy. The reason is the total amount of loan interest you pay will be a lot and it is just not worth it. Unless you're really a property investment guru, I will recommend you to use this safest property investment strategy.


(3) Maternity Leave is now 90 Days

This is only for government servants and you will get fully-paid maternity leave for 90 days. So nice! It stated allow flexibility to self-determine maternity leave as long as it doesn’t exceed 90 days. But who doesn’t want to take up to max? Maybe if you’re female, you should consider to join the government sector. Being a school teacher seems like a good choice. :) I will go for it if I were a female. lol! :)


(4)  Increase Minimum Salary for Workers

Security guard salary will be increased to RM500 – RM 700. For those who are security guard, this will help. Anyway, I have no idea the salary for security guard is that low. The current average salary for a security guard in Malaysia is between RM 300 and RM 400 but I  think for those in private sector, it should be more than that. A wage council to be setup to decide the minumum salary for workers in Malaysia. I guess this doesn’t applicable to me again, this is mainly for those of you who have very low paid salary.


(5) Service Tax to be Increased from 5% to 6%

Huh, what’s up? I”m speechless… I think what you should react is to eat less in restaurant and cook more for yours

[Update:17 Oct 2010]
Based on the feedback & comment from Chong, I just realized that the scope of service tax has been extended to include subscribers of paid broadcasting services such as Astro. This is bad because now you want to pay the extra 6%. It used to without this charges. Perhaps you should consider to unsubscribe Astro if your Astro usage is really low.

This also affected the hospital bills too not just restaurant. Basically you will need to pay extra 1% for your hospital bill too. This may be a burden to certain people.


(6) Cheaper Mobile Phone

The will be removal of the 10% sales tax on ordinary mobile phones. Initially it is stated for all type of mobile phones and it actually means all type of ordinary phones. So iPhone or any smart phones are not included as long as your phone can access to internet. This move seems like target to those who do not afford to buy mobile phone. I hope this move doesn’t encourage people to change phone even more often! :)

[Update:23 Oct 2010]
Since many people asked me to clarify, it seems like all the while there is no sales tax for smartphones or those with Internet applications (which I"m not aware of it). So this 10% sales tax discount has no impact to smart phones at all. So you can go ahead to buy your iPhone now and don't need to wait for next year! :)



(7) Cheaper Branded Stuff


Import duty tax will be removed for 300 popular tourism items to promote Malaysia as Asia’s shopping haven. So you can now spend more especially for girls who like shopping a lot.  Yes, I know spending money is fun but please watch out your spending while shopping and further more this move is really meant for tourist.. :)


(8) Private Pension Fund for Self-Employed

This is good news for those self-employed as now they’re entitled the same benefit with employee. There will be RM6K tax exemption same as EPF too.


Summary


Well, what can I say more? Did I miss any important? You can share that with me. I hope at least you’re happy with some of them especially you’re the self-employed or first-time house buyer. This budget is really have no effect to me at all except for the 6% service tax. But that should be affecting everybody… :(

P/S: Remember to keep your broadband receipts for 2010 tax deduction.

11 Comments:

Chong Kong Hui said...

Astro subscriber to pay additional 6% for newly imposed service tax, right?

ChampDog said...

Oh ya, thanks for pointing that out. This really sucks! I used to have 2 Astro accounts in PG and SP. I canceled one of them for quite some time. Perhaps I should also cancel another one as the usage is quite low.

Anyway, even without Astro I still manage to find a way to watch the latest HK series(that's the reason why my parents need the Astro for).

Kris said...

90 days maternity leave :

That is why people say always find a teacher to be a wife :P

Secure rice bowl and also a lot of leaves :P

Yeah..looks like only the 6% service tax will affect the middle and high income group.

Chong Kong Hui said...

Based on data from the 2009 audited accounts of Astro All Asia Networks plc, service tax on paid TV broadcasting services could possibly generate an additional RM148mil in revenue for the Government.

However, about 1/2 of this additional tax revenue will goes to renovate PM residence. Yes, Malaysia Boleh!

ChampDog said...

@Kris
Yes, being teacher is actually not that bad. Few of my colleages' wife is teacher too:) You can earn extra from tuition too especially you forgot to pay your tax. lol... Not that pressure too...

Why only middle income and above? Isn't that it should affect low income class as well?

@Chong
I'm sad to see what this is happening to Malaysia. Our politic condition is really weak that's why you see especially Chinese are migrating out from the country and this is getting more and more. This is very sad indeed.

Kris said...

@ChampDog,

Ah..looks like i did a typo, after i reread what i post up..
Yup..the service tax should affect everyone.

You ever plan to migrate?

elpi said...

Yeah the service tax really affect us

Alvin said...

nice list :) i wonder, can we actually find a 350k house in PJ area nowadays? :P don say studio. i think a normal condo also easily go beyond that.

ChampDog said...

@Kris
I've thought of migration but I've NOT yet planned anything yet. Hahaha...

The thing is you need to be careful of what people around you who usually only says good things about certain country (e.g. Australia). You still need do your own research what are the pros and cons. E.g. what are the things that you give up? What are the gains? Is that really worth?

Also, you also need to make sure you get the reliable agents to help you. They're a lot of cheating out there and if you're not careful enough, you could be the victim.

So at for this point time, I have no plan to migrate yet. It is not an easy decision and need to think really carefully. It may not solve the problem that you face now or anther problem may raise.

What about you then, Kris?

@elpi
Yes, too bad. I think we just need to watch out our spending or just cancel the Astro subscription if you have.

@Alvin
Thanks.I'm not sure about PJ. PG is still possible for apartment. How about apartment in PJ? Should be okay, I guess.

Jayce said...

No income tax reduction but increase in service tax. :(

ChampDog said...

Yes, I agree. Too bad...


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