Prosperity Tax : Dr Muhd Abdul Khalid and Dep Finance Minister Yamani Hafez Hit The Nail Spot On

 

https://www.freemalaysiatoday.com/category/nation/2021/11/05/where-is-fairness-economist-asks-over-measly-non-bumi-budget-allocation

• PJ : prominent economist questions lack of fairness in Budget 2022
• massive disparity between Bumi and non-Bumi allocations
• Dr Muhd Abdul Khalid said RM11.4b for Bumis dwarfed RM345m for nons
• That is only 3% of what Bumi community received
• “What is important, as Muslim, is concept of fairness. Where is the fairness?
• total allocation for Bumis over past three budgets RM30b
• “But what is outcome? We do not know. Which Bumis have been helped?”

(OSTB : That is a very good question. "Which Bumis have been helped?" I think some of the RM30b has gone to the British Virgin Islands.)

• Zaid Ibrahim remarked “nice” to be Bumi as billions set aside for community
• “only country in world where Budget is race-specific” he said on Oct 29.

Khalid also took aim at the Prosperity Tax / Cukai Makmur
corporate earnings above RM100m taxed at 33% instead of 24%
Reaction to Prosperity Tax swift on Bursa Malaysia
market cap dropped RM33.8b

dep finance minister Yamani Hafez admitted drop due to Cukai Makmur

We never heard (of this tax). Suddenly (the tax) is raised to 33%. For the sake of earning RM3b extra tax we saw our market cap drop RM33b,” Khalid said, adding drop in market cap also affected GLCs

biggest issue was sudden shift in policy and this undermined market confidence

“market will tolerate taxation but not like this. The concept is fair taxation,” he said.

OSTB : 'sudden shift in policy' means it was wild horse policy making.

Kuda liar / wild horses

Syabas to Dr Muhd Abdul Khalid for being clear and concise about the Budget and that Prosperity Tax.  Dr Muhd Khalid holds a Phd in Economics from the Institut d’études Politiques de Paris, France.  I attended his wedding in Penang not too many years ago. 

So just to earn an extra RM3 billion in taxes the Prosperity Tax wiped out over RM33.8b from the market capitalisation of the Bursa Malaysia.

Worse than that it has frightened all investors - domestic and foreign - that the Government of Malaysia is still bent on making unpredictable, sudden and unthinking policy changes that can create losses for investors.  The government has damaged the trust of the investors. They will become less confident in our country.

Syabas also to deputy Finance Minister Yamani Hafez Musa for acknowledging that the loss of RM33.8b in market capitalisation was caused by the Prosperity Tax or Cukai Makmur. I hope you do not lose your job.  Zafrul is a polite and well mannered fellow but I think thats it.

I have a suggestion to the Government - DO NOT IMPLEMENT THAT PROSPERITY TAX. Budget 2022 kicks off on 1st January 2022. That is two months away. Just forget about the Prosperity Tax. Quietly set it aside. Do it quietly.  

I told you so. So many times. Never punish the rich for earning honest profits through their hard work and diligence. 

Go and punish those who are lazy and those who want to makan free lunches and free durians. 

The views expressed are those of the writers’ and do not necessarily reflect those of MMKtT.