Chong hails Budget 2025 as ‘Robin Hood’ budget to cut deficit, help the poor

KUCHING (Oct 19): The Budget 2025 is a fiscal reform budget with the government minded to reduce spending while increasing the tax, said Democratic Action Party (DAP) Sarawak chairman Chong Chieng Jen.

The Stampin MP said the budget tabled in Parliament on Friday maintained the trend of decrease in deficit, from last year’s deficit of five per cent of the gross domestic product (GDP) of RM91.392 billion, to this year’s deficit of 4.3 per cent of GDP (RM84.296 billion) to the 2025 deficit of 3.8 per cent of GDP (RM79.973 billion).

“Such measure is necessary given that the national debt is expected to reach RM1,500 billion by end of 2024, which implies that for every ringgit of government revenue, 16 sen will be allocated to pay interest on the loan, a result of more than two decades of continuous deficits,” he said in a statement today.

Chong said the Budget 2025, while aimed to reduce spending, also has the characteristics of a “Robin Hood” budget, which taxes the rich and helps the poor.

He believed that the welfare benefits and cash handouts in the Budget 2025 will eliminate all hardcore poor in the country.

Besides the cash handouts, he said the raise in minimum wage rate from RM1,500 to RM1,700 will across the board increase the income level of the lower income earners in the society.

“While the employers may face an immediate increase in the wage component of their costs, in macro perspective, this increase in wages will most likely be all spent in the local market as a boost to our domestic market and economy,” he said.

According to him, Malaysia’s employee’s compensation to GDP this year 2024 is 33 per cent which means that there are 15.81 million employees in the country.

“In other words, employees in Malaysia are not proportionately compensated or that they are under-paid.

“Therefore, the increase in the minimum wage rate is a reform and a means to redistribute this unproportionate wealth distribution in our economy,” he said.

Chong said the targeted subsidy for RON95 petrol will see that the top 15 per cent of the population and the foreigner will no longer enjoy RON95 at the subsidised rate.

He said this is a painful but necessary measure given that the savings is estimated to be RM8 billion.

He, however, added that the only concern would be how the mechanism will be implemented so that the deserving ones will not be left out.

“The success of all policies lies in the implementation. As the government has the experience in the rationalisation of diesel subsidy this year, I am confident that the rationalisation of RON95 subsidy will be implemented smoothly.”

Even with the tight spending constraints, Chong said the Budget 2025 also provided for many incentives for the artificial intelligence (AI) and digitalisation innovation in the local industries.

With this, he hoped that Sarawak companies, industrialists and local manufacturers would catch on with this global trend to transform their production process.

“I have anticipated that there might be a revision on the e-invoicing threshold when the policy is applicable to all in August 2025. However, there was no such announcement in the Budget speech.

“I will in the debate in the following weeks highlight the call by many, especially the hawkers, for the increase of the threshold to RM500,000 as the introduction of e-invoicing will definitely be an additional cost to them,” he said.

Chong said that the Budget 2025 has set the right priorities by allocating the highest amount for education, followed by healthcare and then security.

“In order that the Budget will achieve its purpose, the implementation thereof must be fair, equitable and efficient,” he added.