SUPP Stakan Chairman, Dato Sim Kiang Chiok said the 2025 Federal Budget, announced by the Prime Minister on October 18, 2024, is both comprehensive and the largest budget aimed at supporting our nation’s growth.

However, he said, Sarawak’s allocation is only RM5.9 billion out of the RM86 billion development budget, which amounts to just 6.8% of the total. This is a relatively small portion.

The minimum wage raised from RM1,500 to RM1,700 starting February 1, 2025, with a six-month delay for businesses with fewer than five employees. This increase, he believed will significantly impact the cost of doing business and may lead to higher prices for goods. Additionally, the wage hike will likely create a ripple effect, requiring other wages to be adjusted as well.

The targeted subsidies for RON95 petrol which are set to begin in mid-2025, Sim said this decision should be carefully considered to avoid further inflation, especially coming just four months after the minimum wage increase.

The expansion of the service tax and SST will likely contribute to rising prices and an increase in the cost of living. It will also make doing business in Malaysia more challenging.

He said the continuation and increase in cash aid for the B40 and M40 groups, including singles, is a positive step to ease the cost of living. However, with the expected rise in fuel prices, the minimum wage increase, and the expanded SST as announced, prices are likely to go up. Hopefully, with the ‘give and take’ of this budget the impact on the cost of living will be minimal.

“On the support for housing in the budget is limited. While there are loan guarantees for 57,000 first-time homebuyers and RM900 million allocated for affordable housing, there is no Home Ownership Campaign (HOC). Under the HOC, developers would provide at least a 10% discount, and the government would waive stamp duties for property purchases, including loan documents. The budget also lacks a deposit assistance of RM30,000 for first-time buyers to help them meet the initial deposit. However, there is a RM7,000 individual tax relief for housing loan interest payments of up to RM500,000, which can be claimed for three consecutive assessment years. While helpful, this relief is small in comparison to other possible measures,” he pointed out.

As a parent of an autistic son, Sim is encouraged by the specific assistance provided in this budget for autistic children as the budget includes support for early training centers, schools, cash allowances, tuition fee assistance, grants for private autistic schools, autism service centers, and an increase in the tax exemption for parents, from RM4,000 to RM6,000, for medical treatment of autistic children. These measures give hope that the special needs of autistic children and adults will continue to be cared for by the Federal government.

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