World Bank: New sources of income needed to offset decline in Malaysian government’s revenue in 2023

In view of moderating crude oil prices that may trim the federal government’s revenue in 2023, the World Bank recommends the federal government to devise ways to diversify the revenue stream.

鉴于原油价格放缓可能会削减联邦政府 2023 年的收入，世界银行建议联邦政府想办法使收入来源多样化。

World Bank’s lead economist for macroeconomics, trade and investment Dr Apurva Sanghi said Malaysia also continues to undercollect in personal and consumption taxes, trailing many comparative peers that are expected to restrict revenue stream to the coffers.

世界银行宏观经济、贸易和投资首席经济学家 Apurva Sanghi 博士表示，马来西亚在个人和消费税方面也继续征收不足，落后于许多相对国家，预计这将限制国库的收入来源。

“In the case of Malaysia, reducing expenditure is important but increasing revenue arguably is even more so. This is because of the decline in revenue in the last 10 over years. The Goods and Services Tax (GST) is not the only way the government can raise revenue, but there’s personal income tax (PIT) which in Malaysia is not optimal. Tax reliefs in personal income tax are not helpful,” he said at the World Bank’s Malaysia Economic Monitor February 2023 entitled ‘Expanding Malaysia’s Digital Frontier’ on 3rd February.

“就马来西亚而言，减少开支很重要，但增加收入可以说更重要。这是因为过去 10 年收入下降。商品及服务税（GST）不是政府增加收入的唯一方式，但个人所得税（PIT）在马来西亚并不是最佳选择。个人所得税的税收减免没有帮助，”他在2 月 3 日题为“扩展马来西亚的数字前沿”的世界银行 2023 年 2 月马来西亚经济监测中说。

The draft Budget 2023, which was tabled in last Oct, gave a 2% personal income tax rate reduction from 13% to 11% for middle-income households with a taxable income of between RM50,000-RM70,000.

去年 10 月提交的 2023 年预算案草案，将应税收入介于 50,000 至 70,000 令吉之间的中等收入家庭的个人所得税税率从 13% 降低 2% 至 11%。

In addition, households with a taxable income of between RM70,000-RM100,000 would see their personal income tax rate decline from 21% to 19%. Meanwhile, a higher tax rate of 25% (previously 24.5%) will be applied to households with a taxable income of RM250,000-RM400,000.

此外，应税收入介于 RM70,000 至 RM100,000 之间的家庭，其个人所得税税率将从 21% 降至 19%。同时，应税收入为 250,000 令吉至 400,000 令吉的家庭将适用更高的 25% 税率（之前为 24.5%）。

“Overall, this is expected to have limited impact on improving revenue collection in the future” said Apurva.

“总的来说，这预计对提高未来税收的影响有限，”Apurva 说。

He added that rigid expenditures remain high and are expected to increase in 2023. Notably, obligations related to salaries, pensions, and interest payments stood at around 56% of total government spending in 2022 compared with 66% in 2021.

他补充说，刚性支出仍然很高，预计到 2023 年还会增加。值得注意的是，2022 年与工资、养老金和利息支付相关的义务占政府总支出的 56% 左右，而 2021 年为 66%。

“The combined spending on these structural expenditures is expected to increase to 61% of total government expenditures in 2023. The increased spending on these items, together with the decline in revenue, remains a constraint to the government’s fiscal space and poses a challenge to long-term fiscal sustainability,” said Apurva.

“到2023年，这些结构性支出的总和预计将增加到政府总支出的61%。在这些项目上的支出增加，加上收入的下降，仍然制约着政府的财政空间，并对长期财政可持续性构成挑战，”Apurva说。

According to the World Bank’s report, government revenue collection is expected to decline further from 15% of gross domestic product (GDP) in 2023 to an average of 14.7%  in the medium-term.

根据世界银行的报告，政府收入预计将从 2023 年占国内生产总值 (GDP) 的 15% 进一步下降至中期的平均 14.7%。

“The Fiscal Responsibility Act (FRA) which is being drafted and finalised, should include detailed plans on measures to diversify its revenue sources. Consideration should be given to streamlining reliefs and broadening the tax base of personal income tax and by enhancing the consumption tax framework,” said the World Bank report.

“正在起草和定稿的《财政责任法》（FRA）应包括有关使其收入来源多样化的措施的详细计划。应考虑简化减免和扩大个人所得税的税基，并加强消费税框架，”世界银行的报告称。