Budget 2021 Malaysia

The Touch Points

Strategy 1 : Overcoming COVID-19 Pandemic (RM4.02b)

• Raise the ceiling of the COVID-19 Fund, by RM20 billion, to RM65 billion.
• Increased allocation to stem the 3rd wave of COVID-19 for next year (RM1 billion)
  • Purchase of reagent, Viral Transport Media and consumables specifically for usage in medical laboratories (RM475 million).
  • PPE and hand sanitisers for frontliners (RM318 million).
  • National Security Council and National Disaster Management Agency (RM150 million).
  • Purchase of equipment, laboratory test supplies and medicines at university training hospitals (RM50 million).
  • Increase the equipment for dental facility operation, virtual clinical services and preparation of preliminary zone facility and thermometer at health services to meet the new norm Standard Operating Procedures (SOP).
• One-off grant of RM500 in appreciation of contribution of MOH frontliners.
• Participation in the COVID-19 Vaccine Global Access (COVAX) programme and commitment to provide vaccine to meet the needs of the rakyat (RM3 billion).
• Expand tax relief scope for medical treatment expenses covering vaccination expenses such as pneumococcal, influenza and COVID-19 limited to RM1,000.
• Increase the tax relief limit on medical care expenses for self, spouse and children for serious illnesses from RM6,000 to RM8,000.
  • Tax relief for the scope for full health examination and vaccination expenses to be increased from RM500 to RM1,000.
• Tax relief limit of expenses for medical treatment, special needs and parental care is increased from RM5,000 to RM8,000.
• Mental health programme, violence and injury prevention, and substance abuse (RM24 million).
• Broaden mySalam’s coverage to medical device expenses claim such as heart stent or prosthesis.
• Tenang Voucher Programme for B40 group :
• Pneumococcal Vaccine Programme for children (RM90 million).
• Biologic medicine specially for rheumathoid arthritis patients (RM6 million)
• Home-based Peritoneal Dialysis treatment programme (RM25 million)

Strategy 2 : Safeguarding the Welfare of Vunerable Communities

Measure 1: Improving Financial Assistance

• Increase the monthly rate of financial assistance as follows (RM2.2 billion) :
  • The rate for financial assistance for person with disabilities who are incapable of work is increased from RM250 to RM300 per month;
  • The rate for financial assistance for senior citizens and financial assistance for carers of bed-ridden disabled person (OKU) and chronically ill is increased from RM350 to RM500;
  • The rate for incentive allowance for disabled workers is increased from RM400 to RM450 per month;
  • The rate for financial assistance for children from poor family is increased from RM100 per child with a maximum of RM450 per family, to RM150 per child aged seven years to 18 years, or RM200 per child aged six years and below with a maximum of RM1,000 per family.
• Bantuan Prihatin Rakyat (BPR) with improved rate and income category as follows (RM6.5 billion) :
  • Monthly household income <RM2,000 :
    • One child or less will receive RM1,200;
    • Two children or more will receive RM1,800;
  • Monthly household income between RM2,501 and RM4,000 :
    • One child or less will receive RM800;
    • Two children or more will receive RM1,200;
  • Monthly household income between RM4,001 to RM5,000 :
    • One child or less will receive RM500;
    • Two children or more will receive RM750;
  • Single individuals earning <RM2,500 per month will receive assistance of RM350. The age limit for this group is 21 years, compared to the condition before this of 40 years.
• Jaringan PRIHATIN Programme (RM1.5 billion) :
  • An estimated 8 million individuals in the B40 category will receive assistance of RM180 per person in the form of telecommunication credit.
  • Telecommunication companies will match by providing benefits valued at RM1.5 billion in the form of free data.

Measure 2 : Alleviating the Rakyat’s Cost of Living (RM4.2 billion)

• Income tax reduction for resident individuals which will be reduced by 1 percentage point for the chargeable income band of RM50,001 to RM70,000 (RM262 million)
• Enhance the Targeted Loan Repayment Assistance (TRA) as follows :
  • B40 borrowers / micro loan enterprise (loans < RM150,000) will be given the following options :
    • Option 1 : Moratorium on their instalments for a period of 3 months;
    • Option 2 : Reduce their monthly repayment by 50% for a period of 6 months.
• Eligible borrowers will only need to contact their banks to choose the options and complete the documentation.
• For the M40 borrowers, the application process for the repayment assistance will be simplified by making a self-declaration of the reduction in income in order to secure the repayment assistance.
• Minimum employee EPF contribution rate is reduced from 11% to 9% from beginning January 2021 for a period of 12 months (RM9.3 billion).
• Facility to withdraw EPF savings from Account 1 for those who have have lost their jobs (RM4 billion).
  • RM500 a month with a total of up to RM6,000 over 12 months.
• Enhancement of the Employment Insurance Scheme (RM150 million) :
  • Job search allowance will be extended by 3 months; and
  • Terms and condition :
    • First month : 80% of salary
    • Second till 6th month : 50% of salary
    • Last 3 months : 30% of salary
• The income tax exemption limit for compensation for loss of employment increased from RM10,000 to RM20,000 for each full year of service.
• Allocation for subsidies, aids and incentives (RM28 billion).
• Community Drumming Programming (RM200 million).
  • The programme will be broadened to cover 34 new areas such as Pulau Sakar in Sabah and Ulu Mujok in Sarawak (basic goods : rice, sugar, flour, cooking oil, LPG gas, RO95 petrol and diesel).

Measure 3 : Assistance to Farmers and Fishermen

• Rubber Production Incentive will be doubled from RM150 million to RM300 million.
• Paddy Price Subsidy (RM570 million).
• Subsidy and incentive for paddy crop (RM960 million).
• Subsidy for Padi Bukit fertilizers (RM40 million).
• Allowance for fishermen will be increased from RM250 to RM300 per month.
• Write-off the interest of the FELDA settlers’ debt (RM400 million).

Strategy 3 : Generating and Retaining Jobs

Measure 1 : Hiring Incentive

• Penjana Kerjaya (RM2 billion) :
  • Incentive for employees earning RM1,500 and above will be increased from flat rate of RM800 per month to 40% of monthly income, subject to a maximum income of RM4,000 (within 6 months).
  • Additional incentive of 20% of an employee’s monthly income will be given to employers who hire disabled (OKU), single mom, unemployed and retrenched workers (within 6 months).
  • High reliance of foreign workers such as construction and plantations, a special incentive of 60% of monthly wages will be provided whereby 40% will be channelled to the employer while 20% will be channelled as a wage top up to the local worker replacing the foreign worker (within 6 months).
  • The maximum rate of Penjana Kerjaya Training Programme will be increased from RM4,000 to RM7,000 for highly skilled training and professional certifications.
  • Formation of National Employment Council
    • To coordinate various initiatives cutting across ministries and agencies which create job opportunities, skills enhancement and training for employees. The LAKSANA unit will be responsible to monitor the effectiveness of all these initiatives to ensure the rakyat continues to receive employment opportunities.

Measure 2 : Reskilling & Upskilling

• Reskilling and upskilling programmes with a total of RM1 billion will be allocated benefitting 200,000 trainees as follows :
  • KPT-PACE (fresh graduates will each be eligible for a voucher worth RM3,000 to pursue a professional certification course at public or private universities) (RM150 million).
  • HRDF to implement trainings in collaboration with private-sector employer (RM100 million).
  • MDEC to transition existing workforce to fill the growing needs in the ICT industry (RM100 million).
  • IRDA and SEDIA to provide new skills training to workers badly affected by the closure of borders to foreign tourists (RM100 million).
  • PERHEBAT for entrepreneurship traninig programmes that will benefit 12,000 veterans of the Malaysia Armed Forces (RM30 million).
  • The scope of relief for tuition fee be expanded to cover expenditures incurred for attending upskilling courses provided by certified bodies limited to RM1,000 for each year of assessment.