Excuse me?

I know this is not really tax related, but it’s the big news for the day and I am seriously confused over it.

The news: Here.

The extract…

KUALA LUMPUR: The 30% bumiputra equity requirement for Malaysian companies seeking public listing is now repealed, said Prime Minister Datuk Seri Najib Tun Razak.

However, these companies are now required to offer 50% of the public shareholding spread to bumiputra investors.

For the uninitiated, public shareholding spread is the percentage of shareholding in a listed company that must be held by the public. In numerical terms, that’s at least 1,000 people. 999 persons does not constitute the public, got it? Under Bursa rules, the current minimum public shareholding spread is 25%. But what I understand from an investment banker is this… its near impossible to even meet the 1,000 people-equals-to-public requirement in the first place. Usually, listed companies would just make an application for exemption from having to comply with this. To top that off, the determination of who gets how much shares is subject to a public ballot. Yes, lucky-draw style.

Now, if a question hinting heavily on the nonsensical impracticality of the “groundbreaking” announcement hasn’t popped up in your head already by now, go back to the top and read this post again.

Per diem allowance exempted

Or maybe I’m exaggerating. Or dreamt it up. Or maybe my poor abused mind has finally popped on the notion that meal allowances relating to meal expenses aren’t exempted when they proposed an exemption on meal allowances.

Anyway, Halijah Bulat announced at the Malaysian Tax Conference 2009 (which is the localised version of the National Tax Conference) that MOF has agreed to exempt “day allowance”. A few squints, blinks and one creative thought later, one should deduce that she meant per diems that employees usually get when they go overseas, because she spoke about trips overseas.

Be wary though. Can’t find anything in writing about this yet.

Its Mini-Budget Day

Stay tuned…

The feelers are out…

… for Budget 2010, can ya believe it?

Really. The professional accounting bodies are sending out requests for the Malaysian taxpayer’s wishlist for next year.

What was in the newly gazetted Finance Act again?

Oh yeah.

Nothing yet.

P.S. I spent the last three days at our southerly-bloated-with-reserves-reducing-tax-rate-again-to-flippin’-17%-!!!-30-circulars-a-month-ASEAN-member-neighbour.

Since everything else has been postponed, why not?

‘Tis a mini Budget, says the Finance Minister.

Been away… and will be away some more

Not because I’m actually using any of my leave as breaks a.k.a holidays, more that there’s a bug in the house. Sick little terrible two isn’t exactly something you can leave at home under any circumstances.

In any case, its approximately two weeks till the end of the year. So, a little reminder to all tax payers – that’ll give ya’ll two weekends to go do the necessary spending/ accumulating/ hustling for/ gathering/ collating/ begging/ borrowing and/or stealing the documentary evidence for all those tax deductions you’ll need for the taxable year 2008.

So, here’s your list of twelve things for Christmas you wouldn’t want to put off till the new year:-

1. Buy books (or talk to your local MPH store manager about borrowing some extra receipts for 6 years.)
2. Buy a computer (if you haven’t already in the last 3 years.)
3. Make a new year resolution to lose weight and go buy yourself a sporting equipment worth exactly RM300 (like a rowing oar… and then go to Putrajaya and whack whoever came up with that idea over the head with it.)
4. Pay for your parents’ visit to the doctor’s (insist on private. Because as far as tax deduction goes, socialist medical care doesn’t get you much.)
5. Pay your professional qualification subscriptions (if your employer reimburses you based on your receipts, ask the Association for two.)
6. If you’re pregnant and due early January next year, talk to your gynecologist about the stars’ alignment with the tax deduction you could squeeze outta an early Sagittarius baby. 
7. Donate to causes that issue you with a tax exemption receipt.
8. Pay zakat (if possible)
9. If you’re a frequent international traveller (I am freaking jealous), go check your passport’s days in and out of Malaysia and make sure you’re spending more days in Malaysia than you’re out. If you need an extra two weeks to make that happen, stay put and defer your travel plans to next year. Trust me. It ain’t just my envy talkin’.
10. Buy health insurance. 
11. Sell that house by the hill slope.
12. … and a partridge in a pear tree.

Business must be bad…

Previously, signing up for tax courses used to be an initiative by whoever’s interested after having read the brochure. We never got calls from the organisers. In the past few weeks though, it dawned on me that the course organising business is probably feeling the economic gloom. I’ve personally received daily calls that practically broke down my will to spend less of my employer’s money on a day off with free food training.

On something else, its the end of the year and naturally, many are using up their year’s leave entitlement, rendering December an impotent month as far as productivity is concerned. Incidentally, the tax authorities are requesting for a financial services industry consultative session on GST on December 16th. And quite amazingly, the Big 4 accounting firms will be so short of staff around that time that they’ve started calling losers like us their commercial counterparts to attend the session on their behalf.

A long weekend ahead of us. Yay!

Update (@1.37pm): Gasp! They either read my blog (perasan) or there are strong anti-GST forces at work or some sense finally got through. The GST consultation session in December has been postponed to a later date. I don’t suppose the Kuala Terengganu by-election has anything to do with it.

What’s in that 7b package?

Okay, we know that from predominantly savings from fuel subsidies, that’s put 7 big ones into the government’s coffers, which the Finance Minister has committed entirely to stimulating our bearish economy.

So, here’s a take on whether the package is really that stimulating.

Personally, I think this is a case of bad reporting, but I can’t, for the life of me, find out the full details of what makes up that whole RM7b! Here’s the breakdown as much as I could dig out (through cyberspace) -

• RM1.2b will be spent to build 25,000 low cost houses (what kind of stimuli that would be to the Malaysian economy is beyond me… Creation of jobs? Okay, Indonesians can rejoice because there’ll be plenty of construction job openings with the government forking out an average of RM48,000 per house built/ repaired. As for Malaysians, maybe they can now afford that house with their RM30 savings slash spending money per RM1,000 salary… oh wait, weren’t part of our EPF supposed to be accessible anyway to pay mortgages? So, that just means there is nothing addressing the buyers’ side of the 25,000 low cost houses to be built. So, maybe they’ll just end up as mini-white elephants decorating the scenic routes along the North-South Highway, like they always were.)
• RM200m to provide microcredit facilities to help entrepreneurs operating small businesses + RM100m for urban microcredit (okay, I’ll give that a mark of approval for stimulating small businesses. Small steps.)
• RM500m to improve roads in East Malaysia (A little quiz: If a second Penang Bridge… let’s say spanning 3-4 kilometres in length, costs RM4.8b, how much road can RM500m buy you in East Malaysia?)
• RM200m for schools (Headmistresses are rejoicing, according to the newspapers.)
• RM500m for improvement of public transport in major cities (I see potential redefinition to BN cities here… call me pessimistic. Also, remember what happened to that RM400m they promised on the same thing? That’s right. Poof!)
• RM1.5b to set up an investment fund to attract private sector investment (I don’t get this one. If the private sector is supposed to invest into this Valuecap-ish fund, why in the world does the fund need the RM1.5b from the government for?)
• RM400m to expedite the High Speed Broadband project (to expedite? We are already spending RM15b, yes… billion. That was awarded to TM, I think. If 15b doesn’t expedite things, I can’t see how RM400m can.)
• RM500m to upgrade, repair and maintain police stations, living quarters, camps and military quarters (I suppose also to move stations from dangerous areas to safer spots. And then, we can stimulate the Tourism sector by organising tour packages to “cuti-cuti Malaysia yang meningkatkan kadar adrenalin anda”)
• RM600m on minor projects under the public and basic infrastructure project maintenance programme, which includes maintaining village roads, building community halls and small bridges (Okay, we are stimulating the economy… the Indonesian migrant workforce part, that is.)
• RM100m to increase business premises and beautifying and landscaping small towns nationwide (open tender to water them flowers, anyone?)
• RM200m for setting up of pre-school programmes (because in about 12-17 years from now, these little tots will be entering our nation’s workforce. Then, we’ll probably see the multiplier effect of this stimulus injection materialise. That’s right. When we welcome Vision Reality 2020.) 

Okay, that’s RM6b in total, which leaves RM1b unaccounted for. Like I said, its probably just bad reporting, plus the Opposition walk out pretty much overshadowed the contents of that stimulus package, apart from the part of the package that isn’t really part of it anyway because it has to do with asking us to volunteer to reduce our retirement savings. In the grand scheme of all those things, what’s a billion, eh?

Pray

For what’ll be in the stimulus package today.

 

Update: So, we the people, have been asked to spend more… to spur the economy on. By dipping into our savings. Strike One, Mr. Finance Minister.

Definitely a Budgie For the Pudgy!

The thing about Budgets nowadays (as opposed to a few years back) is how the real proposals are actually way back in appendices instead of the speech. What you end up with is a main body of the speech that conjures a truckload of fairy-telling about how the people’s suffering is being addressed by sophisticated sounding  words like “pillars” or “corridors”.

Anyway, that’s just my observation.

I don’t intend to repeat what will undoubtedly be covered in the national dailies anyway. So, here are my seven by seven pointers for this year’s (pretty subdued) nonsensical budget…

1. Those of you earning less than five figures are screwed!
2. Because those who ARE earning that (and way more) are gonna be taxed at the same top bracket as you are.
3. They will also be holding APs for hybrid cars that will screw Proton over so hard, their exhaust pipes will crack probably sell better than normal cars given their zero import tax and 50% discount on excise duty.
4. Oh, and then AP holder’s sugar-daddies can come and pump maybe a few billion Euros to their hybrid-techno-developho-kids via venture capital companies because these companies get… (let me hear it)… Gimme a Tax! Gimme an Ex! Gimme an Emp! Gimme the Ssssshern!
5. Now, once daddy’s money ventures over to their sons’ and/ or sons-in-law’s already overflowing bank accounts, how about another freebie? No pay 5% tax on bank interest.
6. You heard me. Nadda. Zip. Comprande?
7. What’s more… yes, there’s more for the rich… You know how those rich bastards they tend to get travelling allowances, Blackberries, private schooling and nannies for their kids, phone bills, hospital bills, acupuncture treatments, spa therapies (and the list doesn’t seem to end in one page)… all paid for by their companies? Guess what? Uhuh. That’s right.

Now, for the less endowed…

1. Those earning RM3,500 and below will save 50 ringgit next year to pay for their one pump of diesel at the gas station.
2. Because for the same priced road tax, Proton has to bend over and lower their pant-dana’s again who wouldn’t want cars that run on a cheaper fuel?
3. That’s 50 ringgit for the entire year. Because 400 minus 350 is 50. Ya’ll still with me?
4. If you divide that by 365 days, that’s just under 14 sen of savings per day. Can’t buy shit, did I hear you say? (Was there some lowering of import duty for “baja” for that matter?)
5. You could try to eek out RM20 if you make your own fire instead of switching on the light at nights.
6. Good news is, they also promise us decent public transportation by 2014. We’ll need it. Know why?
7. Because by then, our kingmaker states would have run outta oil and our cars would be display units at the junk museum. Or still in queue at Puspakom, whichever.

As for the majority of us who fit in between those two extremes. Nothing. Because the rest of the national coffers goes far east to make kingmakers happy. With that, I bid y’all a Happy Merdeka weekend.