KUALA LUMPUR (Nov 2): Malayan Banking Bhd (Maybank) sees the property sector as the biggest winner of Budget 2019, with a variety of measures ranging from specific allocations for supply – financing of first-time purchases – of affordable housing, as well as stamp duty exemptions and property crowdfunding to help the industry clear the supply overhang, placing it on a path to sustainable growth.
Its group president and chief executive officer Datuk Abdul Farid Alias expects the banking sector will also see respectable growth, especially across the consumer and small and medium enterprise segments.
"The challenge for the government now is to execute the national budget well and be able to react to changing market circumstances very quickly," he said in a statement today.
Abdul Farid said the bank deems reasonable and fair the government's measures to enhance tax revenues under Budget 2019 tabled by Finance Minister Lim Guan Eng in Parliament today.
These include the special voluntary disclosure programme to declare unreported incomes, service tax on imported professionals, information technology and online services, revamping the real property gains tax, airport passenger departure levy, hikes in gaming tax and the introduction of sugar tax.
"They are in line with the current global trends of enhancing tax compliance, as well as taxing services, wealth and digital economy," he said.
Abdul Farid, who is also chairman of the Association of Banks in Malaysia, noted that the budget is a plan for respectable growth while facing an uncertain global trade environment.
"On the one hand it needs to spur the country to a respectable growth in an environment constrained by global uncertainties from the trade war between US and China, while at the same time provide relief primarily to the Bottom 40% (B40) household, and ensuring a path towards zero fiscal deficit," he added.
He also noted that the government's deficit target of 3.7% of gross domestic product (GDP) in 2018 and 3.4% in 2019 are in line with the bank's expectations of above 3%.
"We see this as a temporary situation as the government commits to reduce the deficit ratio to 3% of GDP in 2020 and 2.8% of GDP in 2021 with a medium term target of 2%," he added.
Abdul Farid also said the RM37 billion goods and services tax and income tax refunds, as well as the increase in monthly minimum wage to RM1,100 will be positive for consumer and business spending.
"Subsidies, financial assistance and social safety nets (in Budget 2019) are more focused, as well as needs-and-merits-based, for example, via the improved cash handouts, targeted fuel subsidy, public transport pass, national B40 health protection fund and housewives retirement savings," he said.