Budget 2023 seeks to balance the need for sustained domestic growth amid global economic headwinds while ensuring fiscal prudence given the current volatility seen in financial and currency markets.

The Association of Banks in Malaysia (ABM) chairperson and Malayan Banking Bhd (Maybank) group president and chief executive officer Khairussaleh Ramli said equally important is that the budget also laid the foundations for fiscal reforms, starting with the shift to targeted subsidies.

This must be complemented by sustainable revenue sources to reduce dependence on volatile commodity-related incomes and one-off tax revenues as seen in 2022, he said in a statement today.

“We welcome budget allocations, tax incentives, and fiscal measures that support domestic economic growth and are channelled towards themes of inclusivity, equality, sustainability, security, and building resilience, which applies to all segments of society and business sectors,” he said.

Such incentives and measures are demonstrated among them through the two percentage points reduction in personal and small and medium enterprises (SME) income tax rates, enhancements in financial assistance and welfare payments to lower income and vulnerable groups, he said.

Khairussaleh said this was also seen in the measures to rebuilding retirement and voluntary savings, strengthening of food and social security, acceleration of tourism industry recovery, making homeownership affordable, improving essential public services like healthcare and education, and improving preparedness, responses and mitigations to natural disasters.

ESG and climate agenda

Budget 2023 also highlighted the latest measures that will be adopted by the banks in Malaysia to combat financial scams as announced recently by Bank Negara Malaysia, which banks are fully committed to, he noted.

“This includes the migration from SMS one-time password to a more secure authentication method for certain transactions including fund transfers and payments, change of personal information, and account settings.

“Banks will also have a 24/7 dedicated complaint channel or hotline for customers to report incidents of scam/fraud.

“On top of this, a National Scam Response Centre will be launched soon. We also welcome the added spending under Budget 2023 to strengthen the detection and reporting of cyber threats including the building of cyber forensic capabilities,” he said.

Besides that, he said ABM also supports the continued emphasis to drive the environmental, social, and governance (ESG) and climate change agenda under Budget 2023, which is a key agenda for the local financial sector.

“ABM members have already agreed on a set of seven broad ESG principles for the Malaysian banking industry.

“This includes the commitment to achieve net zero carbon across the entire business and financed customer portfolio, incorporate ESG into governance and risk management, as well as the commitment to identify, mitigate and manage risks of modern slavery and human rights across the supply chain,” he added.

- Bernama

More on Budget 2023

Malaysia's 2023 economic outlook remains favourable

Fiscal Responsibility Act may require statutory limits on contingent liabilities

Public sector debt at RM1.44t, govt may extend 65pct statutory limit

Budget 2023 - The big picture

State leaders laud Budget 2023

State leaders laud Budget 2023

Budget 2023 moves for homeownership will spur property market - groups

Budget 2023 moves for homeownership will spur property market - groups

Budget 2023 priorities in the wrong place - economists

Budget 2023 priorities in the wrong place - economists

'Budget 2023 proof of govt's commitment to protect Keluarga Malaysia’s interests'

'Budget 2023 proof of govt's commitment to protect Keluarga Malaysia’s interests'