There is a urgent need for a total revamp of the country's lopsided taxation system which is woefully outmoded, said opposition leader Anwar Ibrahim.
He pointed out that said currently, the taxation system burdens the middle-class - among professionals, entrepreneurs and civil servants - the most.
"Why can't we be a bit more progressive? A person who earns RM100 million a year, shouldn't be on the same tax bracket as a person who earns RM100,000 a year," he said.
Anwar (left) said this during his keynote address at the Pakatan Budget 2010 dialogue at the Petaling Jaya Civic Centre Hall yesterday to a crowd of some 200 people.
The Budget 2010 speech announced that the maximum personal tax imposed has been reduced to 26 percent, down by one percent.
He said that he has always agreed that the taxation system does not put stress on the majority of people, but said it has not moved with times to encourage the deserving middle-class.
Crisis of confidence
On foreign direct investment, Anwar blamed the falling inflow of investment on waning confidence in Malaysian institutions.
"The budget is not just about accounting. It is also about boosting confidence. What is really lacking is any meaningful effort to regain the confidence lost in our system and institutions," he said.
Taking the judiciary for an example, Anwar said he knew of many American, European and Middle-Eastern investors who are choosing Singapore and Hong Kong courts to adjudicate their cases.
"If you look in totality, there is a loss of a few million ringgit if the investments (here) are huge... As long as confidence not restored, people will leave. " he warned.
Citing another example, he said investors were also adverse to the high crime rates in the country and took a swipe at Inspector-General of Police Musa Hassan.
"We are experiencing soaring crime rates, but the IGP gets an extension of service," said Anwar, prompting mummers of agreement from the floor.
Grants Commission mooted
Another speaker during the event, Selangor Menteri Besar Khalid Ibrahim lamented that the there was disproportionate distribution of federal funds, particularly to Pakatan Rakyat controlled states.
To overcome this, Khalid(right) suggested that a Malaysian Grants Commission be established to ensure equitable distribution of wealth, comprising experts as well as requiring participation from all political parties.
Supporting Khalid's idea, DAP publicity chief Tony Pua gave the audience startling numbers to show the disparity between collection and disbursement to Penang and Selangor, two of the richest states in the country which fell to Pakatan last year.
According to government statistics, said Pua, RM3 billion was collected in taxes from Penang but only RM127 million is allocated for the state under Budget 2010.
The disparity was worse in Selangor, as the collection was RM16 billion and only RM247 million would be channeled back.
"We have suggested this before, at least 20 percent of the revenue collected should be channeled back to the state. In the case of Selangor, that translate to RM3.2 billion," said Pua, who is also Petaling Jaya MP.
Moving up the value chain
Final speaker for the event, PAS central committee member Dzulkefly Ahmad's said the federal government's contractionary budget, which saw a reduction in government spending, meant private consumption and spending must be boosted to maintain growth.
He said the 13- year budget deficit was unsustainable, which was compounded by the fact that Malaysia was a export and commodity centric economy resulting in a low-income regime.
"Najib was spot on when he talked about (an existing) middle-income trap... but I don't see a solution in his speech," said Dzulkefly (right), who is also Kuala Selangor MP.
He said a solution was the creation of a high income economy which can only be harnessed through knowledged based enterprises, produced by a highly sophisticated education system.
Dzulkefly said significant changes would also have to take place at the macro level to ensure that knowledged-based workers are kept in the country.
"Knowledge workers are nation-less and stateless. They will go wherever they can find the best rewards," he said.
A second solution he offered was a minimum wage policy to help shed Malaysia's dependence on low cost foreign labour. There is a urgent need for a total revamp of the country's lopsided taxation system which is woefully outmoded, said opposition leader Anwar Ibrahim.
He pointed out that said currently, the taxation system burdens the middle-class - among professionals, entrepreneurs and civil servants - the most.
"Why can't we be a bit more progressive? A person who earns RM100 million a year, shouldn't be on the same tax bracket as a person who earns RM100,000 a year," he said.
Anwar (left) said this during his keynote address at the Pakatan Budget 2010 dialogue at the Petaling Jaya Civic Centre Hall yesterday to a crowd of some 200 people.
The Budget 2010 speech announced that the maximum personal tax imposed has been reduced to 26 percent, down by one percent.
He said that he has always agreed that the taxation system does not put stress on the majority of people, but said it has not moved with times to encourage the deserving middle-class.
Crisis of confidence
On foreign direct investment, Anwar blamed the falling inflow of investment on waning confidence in Malaysian institutions.
"The budget is not just about accounting. It is also about boosting confidence. What is really lacking is any meaningful effort to regain the confidence lost in our system and institutions," he said.
Taking the judiciary for an example, Anwar said he knew of many American, European and Middle-Eastern investors who are choosing Singapore and Hong Kong courts to adjudicate their cases.
"If you look in totality, there is a loss of a few million ringgit if the investments (here) are huge... As long as confidence not restored, people will leave. " he warned.
Citing another example, he said investors were also adverse to the high crime rates in the country and took a swipe at Inspector-General of Police Musa Hassan.
"We are experiencing soaring crime rates, but the IGP gets an extension of service," said Anwar, prompting mummers of agreement from the floor.
Grants Commission mooted
Another speaker during the event, Selangor Menteri Besar Khalid Ibrahim lamented that the there was disproportionate distribution of federal funds, particularly to Pakatan Rakyat controlled states.
To overcome this, Khalid(right) suggested that a Malaysian Grants Commission be established to ensure equitable distribution of wealth, comprising experts as well as requiring participation from all political parties.
Supporting Khalid's idea, DAP publicity chief Tony Pua gave the audience startling numbers to show the disparity between collection and disbursement to Penang and Selangor, two of the richest states in the country which fell to Pakatan last year.
According to government statistics, said Pua, RM3 billion was collected in taxes from Penang but only RM127 million is allocated for the state under Budget 2010.
The disparity was worse in Selangor, as the collection was RM16 billion and only RM247 million would be channeled back.
"We have suggested this before, at least 20 percent of the revenue collected should be channeled back to the state. In the case of Selangor, that translate to RM3.2 billion," said Pua, who is also Petaling Jaya MP.
Moving up the value chain
Final speaker for the event, PAS central committee member Dzulkefly Ahmad's said the federal government's contractionary budget, which saw a reduction in government spending, meant private consumption and spending must be boosted to maintain growth.
He said the 13- year budget deficit was unsustainable, which was compounded by the fact that Malaysia was a export and commodity centric economy resulting in a low-income regime.
"Najib was spot on when he talked about (an existing) middle-income trap... but I don't see a solution in his speech," said Dzulkefly (right), who is also Kuala Selangor MP.
He said a solution was the creation of a high income economy which can only be harnessed through knowledged based enterprises, produced by a highly sophisticated education system.
Dzulkefly said significant changes would also have to take place at the macro level to ensure that knowledged-based workers are kept in the country.
"Knowledge workers are nation-less and stateless. They will go wherever they can find the best rewards," he said.
A second solution he offered was a minimum wage policy to help shed Malaysia's dependence on low cost foreign labour. There is a urgent need for a total revamp of the country's lopsided taxation system which is woefully outmoded, said opposition leader Anwar Ibrahim.