Friday 29 Mar 2024
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KUALA LUMPUR (Oct 27): Moody’s Investors Service says Budget 2018 “lacks any major fiscal and in particular revenue reforms”.

This, it said, is despite the Budget preserving the deficit-reduction trend that has been underway since 2009. For 2018, the government is attempting to narrow the fiscal deficit to 2.8% of the gross domestic product (GDP), from an expected 3% this year.

“The full credit implications of the Budget will depend on whether the projected increase in revenues — the fastest since 2012 — is achievable since targets rest primarily on a rise in GST collections, which in turn rely on relatively optimistic growth projections going into 2018,” said sovereign risk group’s analyst and assistant vice president Anushka Shah in a statement issued after Prime Minister Datuk Seri Najib Razak tabled Budget 2018 in Parliament today.

He said the expenditure measures in the Budget are targeted at inclusive growth and high-multiplier spending, similar to what other governments are implementing in response to demands from the population and electorate.  

The government has allocated a sum of RM280.25 billion, a 7.46% increase from RM260.8 billion allocated for 2017 for Budget 2018. Of this, RM234.25 billion has been set aside for operating expenditure, while the remaining RM46 billion will be channelled for development expenditure.

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