Anwar's 100 days: Analysts laud tax move, addressing inequality

As Anwar Ibrahim’s government celebrates 100 days in power, analysts are lauding his efforts to bridge inequality and social gaps among Malaysians.

However, they caution that the prime minister has many challenges ahead of him.

Universiti Malaya's Awang Azman Awang Pawi lauded the targeted taxation in the latest budget, which will see individual income tax for the M40 (middle 40 percent of income earners) group lowered by two percent, while the tax rate will be increased for those earning more than RM100,000.

“Targeted taxation is very important to provide fairness. Although Anwar's economic approach has not been fully announced, his attitude and stance are opposed to inequality and the economic gap.

“We see him prioritising the welfare of the poor and lower middle class to provide social justice so that the income gap can be narrowed.

“Tax on luxury goods and other actions that impact the T20 group is more of an adjustment to the existing taxation system.

“We should note that the measures taken to stimulate the national economy will indirectly benefit the T20 group as well,” he told Malaysiakini.

Awang said that the unity government, on its 100th day, need to be evaluated comprehensively, especially the fundamental workings of the government.

“So far, he is a successful prime minister who received a vote of confidence (through voice vote) and seems to enjoy two-thirds majority support in the Dewan Rakyat - which has not happened in the last 15 years.

“This illustrates the great confidence and mandate towards Anwar's leadership despite being a coalition government which was previously seen as fragile,” said Awang.

Anwar’s ascension to power was not a walk in the park. The son of former Seberang Perai Central MP Ibrahim Abdul Rahman, he was detained under the now defunct Internal Security Act (ISA) as a firebrand student leader in 1974 before rebounding to enjoy a meteoric rise in Umno.

After five years as deputy prime minister, he was then sacked by Dr Mahathir Mohamad in 1998 and became a reformasi icon after he was assaulted in detention.

Forming a multi-racial PKR, Anwar was jailed on two more occasions in 1999 and 2015.

Despite his coalition’s victory in GE14, he was thwarted by the Sheraton Move in 2020, which began with Mahathir’s attempt to form a unity government under his own leadership instead of honouring the promise to hand over the top job to Anwar.

While he was finally able to get the job after GE15, Anwar is now leading a unity government - with no guarantees that all the promised reforms made by his Pakatan Harapan coalition will be delivered.

Touching on Budget 2023, political analyst Khoo Kay Peng said the government is focusing on the right priorities such as the cost of living and livelihood of B40 and M40.

“However, the devil is in the details as the fiscal and monetary responses must be able to make a real impact.

“For example, the provision for food security is barely enough to ensure local food production is secure. We need to focus on implementation mechanisms and not just grants.

“The income bottleneck is also an issue to be resolved especially when the world is facing high inflation,” he said.

Aside from bread-and-butter issues, Khoo said that a sizable percentage of the electorate is expecting other improvements in their quality of life.

“Institutional reforms need to be accelerated such as improving public services to make them efficient.

“There's a lot of frustration on the ground with regards to public transport and amenities, flood, and indiscriminate highway projects like the PJD Link that appears to be more commercially driven than a solution to reduce congestion.

“And there are race relations which need addressing. The government needs to focus on bridging the social gaps so that unscrupulous politicians can't benefit from race and religious baiting,” he added.

Closure for 1998

BowerGroupAsia director Adib Zalkapli also said that while Anwar was off to a good start, expectations will be running high.

“This is the first time since 2008 that Malaysia has a government that is supported by at least two-thirds of the MPs. We are also witnessing Umno and DAP being on the same side of the political divide for the first time.

“The swearing-in of Anwar as the prime minister is also an important closure to a political crisis that started in 1998. So, this government has all the elements of a unity government,” Adib told Malaysiakini.

“However, this also means people generally have very high expectations of this government.

“The unity government will also face its first crucial test just months after it was formed when the six state assemblies get dissolved. It’s an extremely short runway for a new administration made up of new allies,” he cautioned.

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