Kota Kinabalu: The Federal Government should translate its improved fiscal position into tangible benefits for Malaysians, including by reviewing taxes and charges that contribute to the cost of living and business operations, said Liberal Democratic Party (LDP) Vice-President Sim Fui.
He said reducing these burdens would allow businesses to retain more capital for investment, employment and expansion, while helping households cope with rising living costs.
“The Government deserves recognition for reducing the federal fiscal deficit from 4.1 per cent to 3.7 per cent of gross domestic product (GDP) in 2025, better than its original target of 3.8 per cent.
“This demonstrates that the Government’s efforts to control expenditure and strengthen its fiscal position have achieved positive results,” he said.
However, Sim, who is also LDP Api-Api division chairman, said fiscal consolidation should not merely result in improved government financial figures, but should also bring relief to the people.
“The people can understand the need for the Government to strengthen its finances. But when the deficit is falling and the fiscal position is improving, the Government should also consider how part of these gains can be returned to the people, rather than merely telling them how much money has been saved,” he said.
Sim said this was particularly relevant following the Government’s diesel subsidy reforms, which had been justified partly by the need to reduce the financial burden of subsidies on public finances.
“As the fiscal position gradually improves, it is only natural for the public to ask: The Government has saved money, but what have the people gained from it?” he said.
He said the Government should use any additional fiscal space to review taxes and charges that directly affected households and businesses, particularly small and medium enterprises (SMEs) and lower- and middle-income groups.
Reducing such burdens would allow businesses to retain more capital for investment, employment and expansion, while helping households cope with rising living costs.
Sim also called for stronger efforts to recover outstanding government loans, following the National Audit Department’s finding that only five per cent of overdue government recoverable loans had been collected, with more than RM9 billion still outstanding.
He said improving debt recovery and the management of public funds would complement expenditure controls by creating greater fiscal space through increased revenue and improved spending efficiency.
“Reducing the fiscal deficit is a positive achievement, but the ultimate objective should not merely be to produce better-looking fiscal figures. Instead, the benefits of economic and fiscal reforms must ultimately be felt by ordinary Malaysians,” he said.
Sim said Malaysians would find it difficult to perceive the benefits of fiscal improvements if they continued to face higher taxes and rising living costs.
“If the country’s finances are becoming healthier, but the people continue to feel that taxes are increasing and the cost of living keeps rising, then the benefits of fiscal improvement have yet to truly reach the people,” he said.
