Painless Budget?

That’s what the Finance Minister called it. But was it painless? Let me count the ways…

1. Service tax on credit cards (yearly) – …. wait for it… payable upon issuance of the card! Imagine this scenario: You get an envelope in your mailbox and the letter says a bank has sent you a free for life credit card. But then, oh by the way, they’ve charged your card with RM50 because its a tax. Scenario 2: You work for a bank. You are issued a card by the bank because… well… you work for the bank. Your bank wants to ease the pain by bearing that tax for you. But then, it becomes a taxable perquisite to you and you get taxed on the freakin’ tax borne by your freakin’ employer just because the freakin’ government decided a piece of plastic has a RM50 tax! Every year!
2. RPGT – First, the Budget speech said it’s 5% on gains, to be implemented by the purchaser withholding 2% of purchase price. Then, the freakin’ Finance Bill came out and virtually said, “It’s the scaled rate that RPGT used to be at, only worse… the lowest tax ain’t 0% anymore, its 5%!” Which was why one of the Big 4 firms then said that the tax is a “knock out punch”. But then, FM2 aka Husni announced in the news that, “It’s not the scaled rate! It’s 5% flat!” So, now we have a limbo of a tax because someone got the drafting of the freakin’ law wrong. Oh yeah… one other thing… when the purchaser is in doubt on whether the seller is getting capital or revenue gain, withhold first. Let the seller go convince the government about the nature of their gain, if any.
3. Reduction in top scale individual tax from 27% to 26% – Amazingly, the speech refers to our top scale rate as the middle income group. I don’t know about you, but I feel insulted.
4. Personal relief on EPF contribution and life insurance to be increased from RM6,000 to RM7,000 – … gotta wait for this one also… BUT that RM1,000 is only applicable to premiums on deferred annuity schemes entered into after 1 January 2010. Okay, I haven’t a clue what that is… which means I have to go find out. Which makes it so “painless” a Budget for me.

No doubt there are some good news in this year’s Budget for some. I’ll get back to you on that later. Busy answering badgering calls from the credit card department.