PUTRAJAYA – The government will focus on the twin aspects of increasing income based on productivity and reducing income disparity in the quest towards driving the nation to developed status.
Prime Minister Datuk Seri Najib Tun Razak said Malaysia’s economy needs to be based on the majority of the people being able to feel that their income is increasing in tandem with improving productivity.
“Only with rising income, does the term, ‘developed nation’, have meaning for the people.
“If the income disparity between the poor and rich is wide, it will create a feeling of dissatisfaction among the people,” he added.
He said this in his speech at the Budget 2015 and Treasury Retirement Night 2014 event, at the Ministry of Finance (MOF) here Friday night.
Najib, who is also the Finance Minister, said based on the World Bank Report released two days ago, as a result of the policies introduced by the government, Malaysia’s Gini coefficient had improved from previously.
“Despite this, we have yet to reach the level of an egalitarian or more equitable distribution of income, such as that in the Organisation for Economic Cooperation and Development (OECD) countries. So, there is a lot to be done,” he added.
He also said that in the uncertain global economy, Malaysia needs to have a strong foundation that is capable of facing and recovering from any form of sentiment.
According to Najib, if the country’s economic fundamentals are weak, any economic crisis will linger, such as what is happening in Europe and no one is exempted from it (the crisis), even if it is a developed nation.
“Among the aspects that determine the country’s fundamentals is revenue that is strong and sustained. As such, the decision to implement the Goods and Services Tax (GST) in the current economic climate, seems to be one that is very correct.
“I say, very correct, as when the country’s revenue is affected, the GST will help support it with a very significant improvement.
“I will not predict, how much of an increase. But we pray that the GST implementation will have a better impact on the country’s improving revenue. When revenue improves, we can help the people,” he said.
Najib also said he was proud of the staff of the MOF, who had shown a high commitment towards the preparation of the Budget 2015 which had been received positively by the people.
Meanwhile, the Treasury Secretary General Tan Sri Mohd Irwan Serigar Abdullah in his speech said with the downtrend in the global oil prices and poor performance of the money market, Malaysia’s economy is expected to remain strong with a targeted Gross Domestic Product (GDP) of more than 5.7 per cent for this year.
He said the registration of companies for the GST as of Thursday had reached 229,700 with more than 4,000 registering daily.
“It is hoped that the number of registrations will exceed the new target of 240,000 by year-end,” he added.
A total of 21 MOF staff of various grades and divisions who retired between June to December 2014 were feted at the event last night. – BERNAMA