Absence of 1MDB Debt Lets Malaysia Lower 2024 Budget Deficit
- Malaysia targets narrower fiscal gap at 4.3% of GDP in 2024
- Government to impose capital gains tax, raise services levy
Malaysia’s government plans to reduce its budget deficit in 2024 through a combination of spending cuts, new taxes and reduced debt payments, as Prime Minister Anwar Ibrahim steps up efforts to convince investors that he’s serious about fiscal discipline.
The government proposes to lower spending to 393.8 billion ringgit ($83.5 billion) next year from a revised 397.1 billion ringgit in the current year, according to the annual budget presented by Anwar, who doubles as the finance minister. That reduction is thanks to the absence of debt obligations related to state fund 1MDB in 2024, which in turn helps narrow fiscal deficit — the gap between revenue and expenditure — to 4.3% of gross domestic product from a 5% shortfall this year, a Finance Ministry report showed.