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MALAYSIAN BUDGET 2018
FULL BREAKDOWN

Prospering an Inclusive Economy, Balancing Between Worldly and Hereafter, For The Wellbeing of the Rakyat, Towards the TN50 Aspiration.

By Datuk Seri Najib Tun Razak, Prime Minister and Finance Minister of Malaysia

CATEGORY 1
INDIVIDUAL TAX AND INCOME

Increase The Potential To Generate Income

  • RM100 million to expand eRezeki, eUsahawan and eLadang Programmes under MDEC;
  • RM120 million is allocated to provide easy loans to 1,000 1Malaysia Food Truck (FT1M) and 1Malaysia Mobile Food Kiosk entrepreneurs through Bank Rakyat and Bank Simpanan Nasional.
  • RM60 million to implement 1AZAM Programme, including RM10 million for Sabah and RM10 million for Sarawak.
  • RM25 million for Three-Wheel Motorcycle Programme under FAMA, GiatMara mobilepreneur and MyAGROSIS programmes.
  • In line with IR 4.0, all registered taxi drivers who wish to shift to e-hailing application, a grant amounting to RM5,000 will be provided for the purchase of a new car.

Increasing Disposable Income (BR1M)

  • In 2017, BR1M has benefited 7 million recipients with an allocation of RM6.8 billion. Likewise, in 2018, those 54 recipients to continue to benefit from the BR1M cash transfer of up to RM1,200 (For b40 Households)

Increasing Disposable Income (Tax)

  • Those in the M40 group or specifically mid-income range households with income of less than RM9,000, can experience an individual income tax rates reduction of two percentage points for income tax band between RM20,000 to RM70,000.

    • Income tax band from RM20,001 to RM35,000, the rate is reduced from 5% to 3%.
    • Income tax band from RM35,001 to RM50,000, the rate is reduced from 10% to 8%.
    • Income tax band from RM50,001 to RM70,000, the rate is reduced from 16% to 14%. This measure will increase the disposable income of the rakyat between RM300 to RM1,000. It is estimated that additional disposable income of RM1.5 billion can be spent by the rakyat. With this measure more that 261,000 individuals are no longer subjected to income tax.

Increasing Disposable Income (Subsidies)

  • The Government allocates a sum of RM3.9 billion for goods and transport subsidies including cooking gas, flour, cooking oil, electricity and toll.
  • Kedai Rakyat 1Malaysia will be restructured as KR1M 2.0. As a start, in 2018, 50 outlets will transformed to KR1M 2.0 and will be expanded further to 3,000 outlets within three years.
  • The Government will continue the Standardisation of Prices for Basic Necessities Programme in Sabah and Sarawak with a total allocation of RM80 million.
  • The Government will develop the Agrobazaar Malaysia with a total allocation of RM20 million to provide market space and agrofood sales centre at a lower price, beginning in Putrajaya.
  • The Ministry of Agriculture and Agro-Based Industry will implement programmes through FAMA and LKIM with an allocation of RM50 million. These programmes enable 56 consumers to purchase food products such as fish, vegetables, chickens and eggs at affordable prices.

Increasing Disposable Income (Tolls)

  • Abolish toll collections at Batu Tiga and Sungai Rasau, Selangor;
  • Abolish toll collections at Bukit Kayu Hitam, Kedah; and
  • Abolish toll collections at Eastern Dispersal Link, Johor.

1Malaysia Retirement Scheme

For those who are self-employed and without fixed income, the Government will increase its contribution to 15% subject to a maximum of RM250 annually under the 1Malaysia Retirement Scheme (SP1M) managed by Employees Provident Fund (EPF). The contribution begins from 2018 to 2022.

CATEGORY 2
EDUCATION AND TALENT

Schools And Maintenance

  • RM550 million to the Special Fund for School Upgrading and Maintenance:
    • National Schools – RM250 million; National-type Chinese Schools – RM50 million; National-type Tamil Schools – RM50 million; Missionary Schools – RM50 million; Boarding Schools – RM50 million; Mara Junior Science Colleges – RM50 million; and Government-aided Religious Schools – RM50 million.
    • RM2.5 billion for school repair works for a period of two years, of which RM500 million to schools in Peninsular Malaysia, RM1 billion in Sabah and RM1 billion in Sarawak.
  • RM2.9 billion is also allocated for food assistance, textbooks, per capita grants and Federal Scholarships for schools.
  • Schooling Assistance worth RM100 per student from the low-income household will be continued with an allocation of RM328 million, benefiting 3.2 million students.

National Higher Education Fund Corporation (PTPTN)

  • Extend the discount for repayment of PTPTN loans until 31 December 2018 as follows:
    • 20% on the outstanding debt for full settlement;
    • 10% for repayment of at least 50% on the outstanding debt made in a single payment;
    • 10% for repayment through salary deductions or scheduled direct debit.
  • For students from B40 households undergoing highly marketable courses, an additional RM200 million is provided to increase the maximum loan amount.
  • The grace period for loan repayment is extended to 12 months upon completion of study compared with six months currently.

Scholarships and Grants

  • RM2.2 billion is allocated for scholarships provided by Public Service Department, Ministry of Higher Education and Ministry of Health.
  • RM400 million for research and development grants is provided to Public Higher Learning Institutions (IPTAs).
  • RM90 million is allocated for MyBrain Programme for 10,600 individuals to further their studies in Masters and PhD.
  • Students in Higher Learning Institutions (HLI) and Form Six will be provided with Book Voucher Assistance of RM250 each.

Science, Technology, Engineering and Mathematics (STEM)

A total of RM250 million is allocated for the following:

  • Set up a STEM centre to develop the latest learning methods to train STEM specialist teachers utilising existing facilities at teachers training institute in collaboration with Academy of Science Malaysia.
  • Enhance Computer Science module including Coding programme in primary and secondary school curriculums, which exist in Form One and Form Three.
  • Allocate a sum of RM190 million to upgrade 2,000 classes into a 21st Century Smart Classrooms.
  • A sum of RM20 million is allocated to Cultural Economy Development Agency.

Skim Simpanan Pendidikan 1Malaysia

  • To inculcate the culture of savings for education, a sum of RM250 million is provided to 500,000 contributors aged 7 to 12 years under National Education Savings Scheme (SSPN-i Plus) which was rebranded as Skim Simpanan Pendidikan 1Malaysia (SSP1M) managed by PTPTN.
  • A matching grant of RM500 will be provided to contributors with a total contribution of at least RM500 and only can be withdrawn upon attaining the age of 18 years.
  • Individual income tax relief for net savings in the SSP1M up to RM6,000 be extended for another 3 years, effective from year of assessment 2018.

Technical and Vocational Education Training

  • RM4.9 billion is allocated to implement the TVET Malaysia Masterplan.
  • Provide 100 TVET Outstanding Student Scholarships with an allocation of RM4.5 million.

Talent Enhancement

  • Open interview programme by the SL1M Unit in EPU will be continued with an allocation of RM40 million.
  • To expand SL1M, private companies awarded with Government contracts are mandated to allocate 1% of their total project value to SL1M.
  • Create a one-stop centre incorporating agencies such as JobsMalaysia, SL1M, SOCSO, Human Resources Development Fund (HRDF) and Unit Peneraju Agenda Bumiputera (TERAJU) in Urban Transformation Centre (UTC) to provide professional advisory services in seeking employment and training.
  • Create a ‘talent file’ programme National Leaders Circle under the TalentCorp to identify and shortlist suitable and credible candidates to fill critical and senior posts.
  • A matching grant of RM50 million will be provided to social enterprises and NGOs to resolve daily social issues and challenges in innovative ways.

CATEGORY 3
HOUSING

Home Ownership

To intensify efforts to increase home-ownership for the rakyat with an allocation of RM2.2 billion as follows:

  • 17,300 units of People’s Housing Programme.
  • 3,000 units of People’s Friendly Home under SPNB.
  • 210,000 units of houses under PR1MA with prices RM250,000 and below. For this, RM1.5 billion is allocation for the period of two years.
  • 25,000 units of 1Malaysia Civil Servants Housing Programme (PPA1M) will be completed in 2018 while another 128,000 units are at various stages of construction.
  • 600 units of MyBeautiful New Homes (MyBNHomes) scheme for B40 households in Terengganu, Pahang, Melaka, Johor, Sabah and Sarawak as well as Orang Asli settlements.
  • 2,000 units under MyDeposit programme to assist down payments as well as MyHomes programme to enable developers to provide more affordable homes.
  • RM200 million is allocated for maintenance and refurbishment of houses, including the 1Malaysia Maintenance Fund.

Affordable Homes

  • To encourage the construction of more affordable homes, the step-up financing scheme introduced by PR1MA will be extended to private housing developers.

  • Abandoned housing projects, stamp duty exemption for loan agreements and letter of consent to transfer, are given to rescuing contractors and original owners of abandoned projects, effective 1 January 2018 to 31 December 2020.

Rental

To promote rental of residential homes, for the first time in 60 years, the Government proposes a 50% tax exemption on rental income received by resident individuals not exceeding RM2,000 per month for resident individuals.

CATEGORY 4
HEALTH

Quality Healthcare

  • RM2.5 billion is allocated for medical supplies, while RM1.6 billion for consumable and medical support items.
  • RM1.4 billion is allocated for upgrading and maintaining healthcare facilities, medical equipment and ambulances.
  • RM100 million is allocated to upgrade hospitals and clinics, including wiring systems.
  • RM50 million is allocated for haemodialysis assistance with a subsidy of RM100 from the overall treatment cost of RM110 per session.
  • RM40 million is allocated for the Medical Aid Fund.
  • RM10 million is allocated for the treatment of increasing cases of rare diseases and RM30 million is provided for Healthy Community Empowers the Nation programme to create awareness about non-communicable diseases in 10,000 locations nationwide.
  • RM50 million is allocated for Voluntary Health Insurance Scheme to enhance the health sector.

New Hospitals

  • Two blocks of women and children wards at Tengku Ampuan Afzan Hospital and Putrajaya Hospital with a capacity of 300 beds each, with a cost of RM1 billion.

  • A block dedicated for a specialist clinic as well as a new ward at Pulau Pinang Hospital with a capacity of 300 beds with a cost of RM500 million.

  • Construction of international forensic medical service centre at Kuala Lumpur Hospital with a cost of RM380 million.

CATEGORY 5
INCLUSIVE DEVELOPMENT

Rural Areas

To provide basic infrastructure in the rural areas, a sum of RM6.5 billion is allocated, among others:

  • RM2 billion is allocated for Pan Borneo Highway.
  • RM1.1 billion is allocated for Rakyatcentric projects including building and upgrading of bridges, village street lights, musolla, small bridges and markets.
  • RM1 billion is allocated through Malaysia Communications and Multimedia Commission (MCMC) to develop communication infrastructures and broadband facilities in Sabah and Sarawak.
  • RM934 million is allocated for the construction of rural roads, including almost RM500 million for Sabah and Sarawak.
  • RM672 million for electricity supply in rural areas, including RM620 million for Sabah and Sarawak, benefitting 10,000 rural homes.
  • RM420 million, including almost RM300 million for Sabah and Sarawak is 41 allocated to provide clean water supply, benefiting 3,000 homes;
  • RM500 million for the Public Infrastructure Maintenance Programme and Basic Infrastructure Project to meet the needs and wish list of the rakyat at the grassroots level;
  • RM50 million is allocated for surveying and mapping of customary lands, of which RM30 million for Sarawak and RM20 million for Sabah.

Blue Ocean Strategies (Low cost with high impact)

For 2018, a sum RM300 million is allocated to implement NBOS programmes, including construction of new UTCs, Blue Ocean Entrepreneur Township, Mobile CTC, entrepreneurship programmes, Global Entrepreneurship Community as well as inclusive and vibrant Social Entrepreneurs.

FELDA Settlers

  • Reimburse the cess money that had been paid by settlers for replanting scheme from rubber to oil palm from 2010 to 2016.
  • RM60 million will be provided for oil palm replanting programme.
  • RM164 million is allocated to build 5,000 Second Generation FELDA Homes in collaboration with SPNB.
  • RM200 million is provided for FELDA to supply water and upgrade road as well as street lights. 

Bumiputera Wellbeing

  • RM1.7 billion is approved for 515 projects under the Facilitation Fund which provides more than 44,000 employment opportunities.
  • RM2.4 billion is allocated to UiTM. At the same time, the Government has increased the number of student intakes to UiTM to more than 165,000 with a target to attain 250,000 students by 2020.
  • RM2.5 billion is provided for higher education scholarship and training programmes under the Council of Trust for the People (MARA).
  • RM90 million is allocated for programmes namely Peneraju Profesional, Skil and Tunas.
  • RM200 million is allocated for the MARA Graduate Employability Training Scheme (GETS).
  • RM555 million is allocated for Bumiputera entrepreneurship enhancement programme, comprising: A sum of RM200 million for Program Keusahawanan dan Premis Perniagaan PUNB; A sum of RM200 million is allocated for Program Keusahawanan MARA; A sum of RM155 million for programmes such as vendor capacity development, Tunas Usahawan Belia Bumiputera (TUBE), Skim Usahawan Permulaan Bumiputera (SUPERB), and Skim Anjakan Usahawan; and
  • To increase equity and investment in strategic sectors, a sum of RM150 million is provided to Pelaburan Hartanah Berhad (PHB) and RM150 million to Ekuiti Nasional Berhad (EKUINAS).

Chinese and Indian Communities

  • RM50 million as loans for SMEs through Koperasi Jayadiri Malaysia Berhad (KOJADI).
  • RM30 million will be channelled to the 1Malaysia Hawkers and Petty Traders Foundation to provide loans to Chinese hawkers.
  • To develop Chinese New Villages, a total of RM65 million is provided, while another RM10 million for housing refurbishment programme.
  • Through Tabung Ekonomi Kumpulan Usaha Niaga (TEKUN), the Government allocates RM50 million for Indian Community Entrepreneur Development Scheme (SPUMI), benefitting more than 35,000 entrepreneurs.
  • RM50 million is allocated for Indian community socioeconomic development programme.
  • PNB will make a special distribution amounting to 1.5 billion additional units of Amanah Saham 1Malaysia for the Indian community, up to 30,000 units for each investor with a a fund amounting to RM500 million is allocated for a period of five years.

Orang Asli

  • To raise the standard of living and economic development of Orang Asli community, a total of RM50 million is provided, comprising community food assistance programmes, benefiting almost 5,000 Orang Asli students.
  • The Government will provide an assistance of RM3,000 for parents to prepare their children’s enrolment in IHLs.
  • Orang Asli Settlement Integrated Development Programme will be continued with an allocation of RM60 million.

Women and Family Wellbeing

  • Require at least 30% participation of women as board of directors in GLCs and GLICs as well as statutory bodies by end-2018.
  • Propose maternity leave for the private sector to be increased from 60 days to 90 days as implemented by the public sector.
  • RM20 million is allocated to conduct training and entrepreneurship programmes, which including PEAK Entrepreneur Programme under MyWin Academy.
  • In order to encourage women to return to the workforce who have been on a career break for at least two years, the Government proposes that their earnings on maximum of 12 months consecutive salary received be given personal income tax exemption.

People With Disabilities

  • Additional tax deductions are extended to cover employers hiring workers affected by accidents or critical illnesses and certified by Social Security Organisation’s (SOCSO) Medical Board that they are still fit to work.

CATEGORY 6
BUSINESS AND INDUSTRIES

Small and Medium Enterprises

  • RM7 billion is allocated under the Skim Jaminan Pembiayaan Perniagaan (SJPP), of which, RM5 billion for working capital and RM2 billion with 70% guaranteed by the Government for services sector, including Industrial Revolution (IR 4.0).
  • RM1 billion is provided as loans to companies with 70% guaranteed by the Government under SJPP to enable SMEs to automate production processes and reduce employment of foreign workers.
  • RM1 billion is provided to the Shariah-compliant SME Financing Scheme with a subsidy of 2% will be provided on profit earned to ease the costs of financing.
  • RM200 million is allocated to SMEs for training programmes, grants, and soft loans under the SME Corp.
  • RM82 million is allocated for the development of halal industries and products.

Micro Financing

  • RM500 Million allocation to Tekun to enable microentrepreneurs.
  • An additional RM200 million to Amanah Ikhtiar Malaysia’s (AIM).
  • RM80 million is allocated under the Rural Economic Financing Scheme (SPED) through Bank Rakyat and SME Bank to provide financing facilities to rural Bumiputera entrepreneurs.

Boosting Exports

  • RM150 million is provided to Matrade, Mida and SME Corp to implement promotional programmes, and expand export markets including Market Development Grant.
  • RM1 billion is provided by Exim Bank for insurance coverage credit facilities.
  • RM200 million for credit financing facilities to SME exporters.
  • RM100 million is provided as loan with 70% guaranteed by the Government to automate production of local furniture for exports.

Boosting Agriculture

RM6.5 billion is provided to assist farmers, fishermen, smallholders and rubber tappers. Among the various programmes to be implemented are:

  • RM2.3 billion is allocated to provide assistance and incentive such as fertilisers and input to paddy farmers, rubber smallholders and fishermen.
  • RM500 million is allocated to improve irrigation infrastructure and upgrade plantation roads.
  • RM200 million is allocated for rubber replanting programme and provide infrastructure to increase production of latex.
  • RM140 million is allocated to developing and replanting of oil palm.
  • RM200 million is allocated for the agricultural programme as new sources of income, particularly the development of dairy industry.
  • A special scheme will be implemented to increase the production of coconuts through replanting of new varieties, namely CARECA and MATAG with an allocation of RM50 million.
  • A monthly assistance of RM200 for three months to paddy farmers while waiting for the harvest season with an allocation of about RM150 million.

Boosting Tourism

  • 2020 is declared as the Visit Malaysia Year.
  • 1 billion is allocated to SME Tourism Fund to provide soft loans to tour operators with an interest subsidy of 2%.
  • RM1 billion is provided to the Tourism Infrastructure Development Fund as soft loans.
  • RM500 million is provided to develop and promote tourism through upgrading infrastructure facilities.
  • Expand eVisa regional hub by facilitating visa application worldwide, especially for expatriates, 19 foreign students, and Malaysia My Second Home Programme (MM2H).
  • Extend tax incentive for investment in new 4-and 5-star hotels until 31 December 2020.
  • Extend tax incentive for tour operators to year of assessment 2020.
  • RM30 million to Malaysian Healthcare Travel Council (MHTC).
  • Extend the investment tax allowance (ITA) of 100% for medical tourism until 31 December 2020.

CATEGORY 7
GOODS AND SERVICES TAX

Changes and Improvement

  • Services provided by local authorities will not be subjected to GST, effective 1 April 2018 or 1 October 2018, according to the choice of local authorities.
  • Reading materials comprising all types of magazines and comics will be zero-rated, effective 1 January 2018, to streamline the GST treatment.
  • Cruise operators are given relief from paying GST on handling services provided by port operators in Malaysia. This relief will be effective from 1 January 2018 to 31 December 2020.
  • Construction of school buildings and houses of worship, funded through donations are given GST relief. It applies for construction contracts signed on or after 1 April 2017. 
  • Imports of oil and gas-related equipment under a lease agreement, supplied to customers in Malaysia by companies in Designated Areas, namely, Labuan, Langkawi and Tioman are given GST relief effective from 1 January 2018.
  • Imports of big ticket items such as aircraft and ships by airline and shipping companies registered in Malaysia are given GST relief. GST relief are also given to companies in the oil and gas industry, importing oil rigs or floating structures, effective from 1 January 2018.
  • The management and maintenance services of stratified residential buildings supplied by the Joint Management Body (JMB) and management corporations are not subjected to GST. This treatment is expanded to cover the management and maintenance services provided by housing developers, effective from 1 January 2018.

CATEGORY 8
VENTURE CAPITAL AND INVESTMENTS

Islamic Financing

  • RM1.5 billion is allocated under SJPP, using intellectual property as an instrument of financial collateral with up to 80% financing guarantee.
  • Tax exemption on stamp duties imposed on contract notes for sales and purchase transactions of Exchange-Traded Fund and Structured Warrants for 3 years, effective January 2018.

Venture Capital

  • RM1 billion is provided by major institutional investors for investment in venture capital in main selected sectors, coordinated by Securities Commission (SC).
  • Expand income tax exemption to include management and performance fees received by venture capital management company, effective from year of assessment 2018 to 2022.
  • The minimum investment in venture companies be reduced from 70% to 50%, effective year of assessment 2018 to 2022.
  • Companies or individuals investing in venture capital companies is provided tax deduction equivalent to the amount of the investment made in the venture companies, limited to a maximum of RM20 million annually.
  • Extend the income tax exemption incentive equivalent to the amount of investment made by an angel investor in venture companies to 31 December 2020.

Sustainable and Responsible Investment (SRI)

  • Income tax exemption for recipients of the special Green SRI Sukuk grant totalling RM6 million.
  • Income tax exemption on income from management fee to be expanded to approved conventional SRI fund managers from year of assessment 2018 to 2020.

CATEGORY 9
GLCs AND PUBLIC SERVICE

Employees in Government-Linked Companies

  • Every GLCs will be given a Key Performance Indicator (KPI) to increase employees compensation in line with productivity growth. This includes:
  • GLCs will increase their profit sharing with their employees through gradual payment of salaries and allowances.
  • Introducing flexible benefits to increase disposable income by substituting annual and medical leaves for cash.
  • Improving further flexible working arrangements to promote work-life balance through compressed work week, flexible and part-time working hours.
  • Introduce leaves for umrah.
  • Provide childcare centre in GLC’s main offices as well as introduce shorter working hours for pregnant working women.
  • Increase investment in training, particularly conduct courses on digital skills to workers as well as provide children’s education assistance.

Public Sector Home Financing Board (LPPSA)

From 1 January 2018, the Public Sector Home Financing Board (LPPSA) will implement measures to enable public servants to own their dream homes. Among the measures include:

  • Allow financing by LPPSA to construct property on waqf land.
  • Include legal fee-related to sales and purchase agreement as part of financing by LPPSA.
  • Allow LPPSA joint-loan for husband and wife or children with a condition that all applicants must be public servants.
  • Allow joint-home financing between husband and wife or children, with a condition at least one of the applicants is a public servant. The non-public servant needs to secure loans from financial institutions or agencies that provide financing facilities that agree to be the second mortgage holder.

Public Servants

  • Introduce second time-based promotion to supporting staff after 13 years from the first promotion.
  • Provide benefit to public servants who retire on medical reasons similar to those who retire at compulsory age.
  • Allow Cash Award in lieu of Accumulated Leave (GCR) of more than 150 days to be taken during the retirement year.
  • Increase special leaves for education officers from 7 to 10 days a year.
  • Provide unrecorded leaves to public servants up to 7 days throughout their service for the purpose of umrah.
  • Introduce new working hour from 9.00am to 6.00pm to provide further flexibility to public servants.
  • Provide Flexible Working Hour one day a week for Grade UD54 and above Medical Specialists who have served a minimum of four years and meet certain requirements.
  • Allow working women in their five month onwards of pregnancy to leave work an hour earlier. To accompany them, husbands are also allowed to go home an hour earlier with a allowed to leave work an hour earlier with a condition that the couple are working within the same location.
  • Increase total maternity leave from 300 to 360 days throughout service subject to a maximum of 90 days a year.
  • Encourage life-long learning among public servants through in-house Masters and PhD programmes.
  • Set minimum pension of RM1,000 per month, benefiting more than 50,000 retirees with at least 25 years of service.
  • Extend the medical facilities to parents of retirees.

CATEGORY 10
LOGISTIC AND TRANSPORTATION

Transportation and Logistics

In order to ensure a more balanced economic spillover between urban and rural areas, the Government will improve logistics and transport infrastructure, through these measures:

  • East Coast Rail Link (ECRL) Project which connects Port Klang to Pengkalan Kubor, Kelantan – construction begin in January 2018.
  • RM110 million is  allocated to provide an alternative road to Port Klang.
  • MRT2 Line from Sungai Buloh – Serdang – Putrajaya Project, spanning 52 kilometres, covering 37 stations (RM32 billion).
  • MRT3 or Circle Line to be completed by 2025, earlier than the initial target in 2027.
  • LRT3 which will connect Bandar Utama to Johan Setia, Klang is expected to be completed by February 2021.
  • High Speed Rail Project connects Kuala Lumpur and Singapore completed by 2026.
  • West Coast Highway from Banting, Selangor to Taiping, Perak is under construction (RM5 billion).
  • Central Spine Road (RM320 Million).

Public Transportation

  • RM3 billion  to Transportation Development Fund (To procure vessels and to develop aerospace technology).
  • RM1 billion to Public Transportation Fund (Working capital and to buy buses and taxis).
  • RM95 million to upgrade and construct jetties.
  • RM45 million is allocated to develop a biometric control system to monitor the bus drivers.
  • RM55 million is provided to subsidise train services in rural areas.

Trade Zones

  • Pulau Pangkor in Perak as Duty-Free Island (excludes products such as alcoholic beverages, tobacco and motor vehicles).
  • Special Border Economic Zone in Bukit Kayu Hitam will be developed. This development includes Free Industrial Zone (FIZ) which will be a new attraction for both domestic and foreign investors.

Digital Free Trade Zones

  • Provides a sum of RM83.5 million to construct infrastructure for the first phase of DFTZ in Aeropolis, KLIA.

  • Increases the de minimis or minimum value for imports from RM500 to RM800 to establish Malaysia as the regional e-commerce hub.

Airports

  • Upgrade Pulau Pinang International Airport and Langkawi International Airport.
  • Construction of a new airport in Mukah as well as expansion of airports in Kota Bharu and Sandakan.
  • new airport in Pulau Tioman.
  • To stimulate development in Labuan, the Government will conduct a feasibility study for the construction of a bridge connecting Labuan with the mainland in Sabah.

CATEGORY 11
COMMUNITY AND NEIGHBOURHOOD

Neighbourhood Heads

  • To appreciate the contribution of village heads and tok batins, the Government will provide a one-off special payment of RM1,500, benefiting 9,800 people. Of which, RM1,000 will be paid in January 2018, and the balance during Hari Raya Aidilfitri.
  • To create safe and peaceful environment in the neighbourhood areas, the Government will continue to provide 1Malaysia People Community Grant up to RM10,000 to registered resident associations to purchase security equipment, clean and maintain neighbourhood areas with a total allocation of RM40 million.

GiatMara (Community Programmes)

  • RM40 million is allocated to GiatMara to implement the first phase of community training programmes, involving PPR.
  • GiatMara skills training scheme will be introduced to tahfiz school students.
  • RM50 million to GiatMara for upgrading and maintaining wiring system in all registered tahfiz schools nationwide.

CATEGORY 12
SECURITY AND PUBLIC ORDER

Counter Terrorism

  • To counter terrorism and extremism such as IS and DAESH, the Government has established a Regional Digital Counter-Messaging Communications Centre.
  • The Government will increase safety at the borders and enhance public order with an allocation of RM14 billion for Malaysian Armed Forces (ATM), almost RM9 billion for Royal Malaysia Police (PDRM) and more than RM900 million to Malaysian Maritime Enforcement Agency (APMM).
  • RM3 billion is allocated for procuring and maintaining defence assets;
  • RM720 million to build 11 headquarters and six police stations as well as purchase of firearm fittings and operations vehicle. Meanwhile, an allocation of RM170 million is provided to upgrade ICT equipment, including 1PDRMnet system as well as RM100 million to upgrade communication systems. In addition, to safeguard the welfare of police personnel, I would like to announce the construction of 10,000 units of houses under 1Malaysia Civil Servants Housing-PDRM 44 (PPA1M-PDRM) at affordable price according to police salary scheme.
  • RM490 million is allocated to APMM for repairing and maintaining ships and boats, upgrading jetties as well as procuring three patrol boats;
  • RM250 million is allocated to Eastern Sabah Security Command (ESSCOM) to enhance security controls at Sabah and Sarawak borders, including RM50 million for coastal surveillance radar;
  • RM50 million is allocated to upgrade the capability of firearm assets of special taskforces to combat anti-terrorism activities; and
  • In appreciation the role of People’s Volunteer Corps (RELA) in assisting rakyat, the Government will provide the highest allocation of almost RM250 million for necessary equipment, including uniforms.

Enhance Armed Forces Welfare

  • Prepare the Armed Forces Family Housing (RKAT) blueprint to construct more than 40,000 units in 45 phases by 2030. In 2018, almost 6,000 units will be built; and

  • A sum of RM40 million is allocated to upgrade five hospitals, build four polyclinics and hospital for ATM veterans.

CATEGORY 13
OTHER MATTERS

Sports Development

  • RM1 billion to implement various initiatives including FitMalaysia, National Sports Day, training for athletes, grassroots programme and national football development programme.
  • To build 14 new sports complexes nationwide with a cost of RM112 million.
  • RM20 million to Bukit Jalil Sports School to upgrade its facilities as the premier sports school.

Industrial Revolution 4.0

  • In line with the emerging IR 4.0 and the era of digital economy, the Government will implement the Malaysia Digital Policy.
  • The Government will provide a matching grant worth RM245 million under the Domestic Investment Strategic Fund to upgrade the Smart Manufacturing facilities.
  • A futurised centre in Cyberjaya will be strengthened as a one-stop centre for corporate companies and universities to develop prototype products and elevate innovation.
  • Tax incentives as follows:
    • Extend the incentive period for Accelerated Capital Allowance of 200% on automation equipment from year of assessment 2018 to year of assessment 2020.
    • Extend the incentive period for Accelerated Capital Allowance of 200% for manufacturing and manufacturing-related services sectors.
    • Capital Allowance for ICT equipment, which includes spending on computer software development, is claimable for the period of four years beginning year of assessment 2018 to 2020, including for SMEs.

Sustainable Development

  • Provide a sum of RM5 billion under the Green Technology Financing Scheme to promote investment in green technology industry;
  • Implement the Non-Revenue Water Programme with a cost of RM1.4 billion to reduce the average loss of water;
  • Construct the Off-River Storage with a cost of RM1.3 billion as alternative water resources; and
  • Provide a total of RM517 million for flood mitigation programmes.

Regulatory Sandbox

  • The Government will create a conducive ecosystem to gain benefits from innovation, particularly ideas from local startups.
  • The Government will expand regulatory sandbox approach to facilitate companies to test their new innovative ideas and business model which will be implemented by all related regulators.

Special Payment For Public Servants

A special payment of RM1,500 be given to all public servants. The payment will be made twice, of which RM1,000 will be paid in early January 2018 and the balance during Hari Raya Aidilfitri. Meanwhile, the Government will provide a special payment of RM750 to Government retirees, of which RM500 will be paid in January 2018 and the balance during Hari Raya Aidilfitri.

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BUDGET 2018


BUDGET 2018
IN DETAIL

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BUDGET 2017
UPDATES

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BUDGET 2018
REACTIONS

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BUDGET 2018
HIGHLIGHTS

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