Deputy Finance Minister Lim Hui Ying today said the Federal Government’s revenue for 2024 is anticipated to soar to RM312.159 billion, buoyed by enhanced tax revenue collection and improved economic growth as stipulated in Budget 2024.
Tax revenue continues to be the primary contributor, constituting 79.5% of total revenue or 12.57% of GDP, with non-tax revenue accounting for the remaining 20.5% (3.24% of GDP).
This revenue surge is expected to be reinforced by robust economic expansion and measures aimed at bolstering revenue mobilization, including broadening the tax base and enhancing tax compliance and transparency.
“Tax revenue remains the main contributor, accounting for 79.5% of total revenue or 12.57% of GDP, while non-tax revenue represents 20.5% (3.24% of GDP).
Revenue collection will be supported by strong economic growth and measures taken to further enhance revenue mobilization through expanding the tax base and improving tax compliance and transparency,” Amir Hamzah said in response to a query raised by Muhammad Ismi Mat Taib [Parit].
“The government has embarked on a commitment to diversify and amplify national revenue sources through various initiatives,” she added.
These initiatives encompasses revenue mobilisation measures, which are expanding the tax base, refining and reassessing the tax structure and legislation, and offering tax incentives.
“Implementation of these measures will be guided by the Medium Term Fiscal Strategy (MTRS) to ensure coherent long-term tax planning aligned with expenditure requirements.
Additionally, the Fiscal Responsibility Act 2023, effective from January 1, 2024, is slated to fortify fiscal governance and discipline.” Lim said.
Additionally, the government in Budget 2024 has announced the expansion of the service tax ambit to encompass logistics, brokerage, guarantee sponsorship, and karaoke services.
“The service tax rate has been elevated from 6% to 8% for all services, excluding specific categories such as food and beverages, telecommunications services, vehicle parking services, and logistics services.
Additionally, the government is set to introduce luxury goods tax, capital gains tax, and e-invoicing in the ongoing year to broaden the country’s revenue base,” she added.
The government’s steadfast commitment to fiscal consolidation in the medium term remains unwavering, with a concerted emphasis on ensuring fiscal sustainability through sustainable revenue generation and expenditure effectiveness. This entails endeavors to enhance efficiency, curtail waste, and minimise inefficiencies across the fiscal landscape.
