Positive effective of 2009 budget on consumer in the country.

As we know, for Budget 2009, government press the feet on the well being of all
Malaysians. For this purpose, it is crucial to further strengthen our nation’s economic resilience
to mitigate the adverse impact of an increasingly challenging external environment. With the
theme A Caring Government, and in line with the five thrusts of the National Mission, the 2009
Budget will focus on three specific strategies, Ensuring the Well Being of Malaysians,
Developing Quality Human Capital and Strengthening the Nation’s Resilience. After all, are
there any positive effects especially to consumer?
Of course yes. Government is like our boss and good boss must concern their workers.
First of all, the positive effect to the consumer is reduction in the cost of living as well as
improves efficiency. Personal income tax exemption or reduction can lighten the people's burden.
The reduction or removal of import duties on a broad range of customer products is a move in
the right direction. For example, for those who is Low-wage earners and those earning a taxable
income of RM35 000 per year or less, they can claim RM400 rebate (vs. RM350 previously).
RM35k – RM50k per year: 1% reduction in marginal tax rate (13 to 12%) and RM230k per year:
28% to 27% reduction in tax rate Tax exemption medical benefits provided by employer
extended to maternity expenses, traditional medicine (acupuncture, ayurvedic).
Secondly is the lower income group and the vulnerable will not neglect by the
government. Vulnerable here mean is people who cannot afford their life well and have physical
disability (Orang Kurang Upaya). Even the OKU is importance to Malaysia towards the
development of our country. We can always proud of them especially in the sport that involving
the OKU. To show how the government concerning about them, government has raised the
eligibility criteria for welfare assistance from a monthly household income of RM400 to RM720
for Peninsular Malaysia, RM830 for Sarawak and RM960 for Sabah. For this purpose, an
additional RM500 million is allocated. As for the OKU, government will give RM150 for those
who cannot work. For OKU student, government has raised their allowance from RM50 to
RM150 and also, incentive to their teacher’s assistance about RM200. Efforts to eradicate
poverty remain an important government agenda in Budget 2009. Prime Minister said the
government was confident that hardcore poverty would be eradicated by 2010.
 Thirdly is improvement in quality of transportation system and continue to encourage
greater utilization of public transportation in the context of improving the productivity and
quality of life. Transportation systems are a combination of time, distance, vehicle load capacity
and volume to transport. Government will buy buses for use not only in Kuala Lumpur and
Penang but also in other areas, besides providing incentives to public transport operators. Prior to
this, the government had announced its plan to buy 100 buses including 30 in the next few
months. To further improve the efficiency of public transportation, RM35 billion allocations will
be expanded during 2009 to 2014 to enhance the capacity of existing rail services, build new rail
services and tracks, increase the number of buses and provide better infrastructure facilities.
Currently, about 20 percent of the Malaysia's population use public transport compared to
between 50 percent and 70 percent in Western nations. Efforts are being made to encourage the
people to use public transport to increase the usage to 40 percent in the next few years.
Last but not least, government will appreciate the public services. In order to do those,
government agree to give them bonus in amount of a month salary with minimum RM1000 for
2008. The bonus will be pay in September and December. So, quality of public services will
increase. Consumer nowadays may have enjoy and smile the pleasure that government give.
In conclusion, budget 2009 can be remark as “A Caring Government”. All of us will get
benefit no matter we are rich, in the middle or else because we are same. We are the Malaysian.
Hence we have to cooperate in order to see our flag, Jalur Gemilang always flap proudly.

Describe and analysis how budget 2009 significantly improve in the disposable income

Budget 2009 was one of the hardest compared with previously. With the economy growth
slowly this year, government have to efficiently spend the spending. Malaysia’s inflation rate hit
a new high of 8.5% in July 2008. This was mainly due to higher costs, particularly from the fuel
and electricity tariff hikes in June.Only if the inflation getting higher, the disposable income will
become lower. This will make government easily faced with the deficit. If this happen, then we
will see disaster in our economic growth. The question is how budget 2009 improves the
disposable income? What is disposable income?
Disposable income is the amount of income left to an individual after taxes have been
paid, available for spending and saving. Remember, increasing the disposable income is the
biggest economic growth other than government spending. As we know, due to the price
stickiness for food and transportation and both carried high weightings in the consumer price
index of 31.4% and 15.9% respectively, we are unlikely to see the prices drop. However, with the
budget 2009, we can see how the government spends a lot on us to make our living cost reduce
and we, as the consumer, have the opportunity to spend more.
On top of that, a reduction in personal income tax rate to 27% for high income bracket
and to 12% for middle income bracket could support consumption in 2009. Additionally, the
2009 Budget also reduces the financial burden of the lower middle income group through a
RM50 rise in tax rebate to RM400 for those with taxable income of RM35 000 and below. This
could help the lower income group to face inflationary pressures and increase the level of
disposable income.

In a move to put more disposable income, government had reduce the allow Employees
Provident Fund (EPF) members to reduce their contributions by three per cent for two years
beginning Jan 1 next year and it is optional. However, most of us still confuse about cut the EPF
and income tax cut because it just likely the same. Having an EPF rate cut means the government
is taking money from our savings, give it to us and hope we will boost the economy. Having a
income tax cut means giving us money from the government's coffers and hope we will boost the
economy. In the government's perspective, it will be better to have us to boost the economy.
Other than that, move by the Ministry of Trade and Consumer Affairs to allow the
extension of operating hours of hypermarkets would encourage spending, especially among the
working class. Neutrality or reducing tax on mobile phones, telephone, and internet bills paid,
motors vehicle and much more can help consumer spend higher than before.
 In conclusion, government should need to consider policy decisions on daily basis, quick,
rapid response to the changing economy. All in all, budget 2009 is focus on increasing
disposable income, lighten people’s burden, lighten business cost and encourage investment.