KUALA LUMPUR – The Fiscal Responsibility Bill, part of an effort to ensure Malaysia’s transition into a sustainable country, may be tabled by the Ministry of Finance (MoF) in the upcoming parliamentary session which is scheduled to start on July 18 this year.
Minister of Finance, Tengku Datuk Seri Zafrul Abdul Aziz states that the Bill will include measures to broaden Malaysia’s tax base. This would encompass taxing the shadow economy while enhancing tax compliance and administration towards increasing tax collection.
During the virtual Malaysian Institute of Accountants (MIA) International Accountants Conference 2022 (MIA Conference 2022) recently, he stated that the Fiscal Responsibility Bill is essential to replenish Malaysia’s coffers in order to sustain the country’s development and long-term reform agenda.
Regarding the government’s efforts to promote Malaysia’s environmental, social, and governance (ESG) goals of establishing climate and socio-economic resilience, the minister stated that the country has three primary strategies that are prioritised to advance sustainable nation building.
The first objective, he said, is to strengthen sustainability-related financing, complementing the agendas within the United Nations’ Sustainable Development Goals (SDGs). These will be implemented through coordinating initiatives and programmes where ESG elements will be inculcated in order to make Malaysia a sustainable financing hub.
He explained that the efforts on ministry and national level had included tagging programmes and projects under the development expenditure to the SDGs under the annual MoF budgets.
Furthermore, he added that Malaysia is among the only 10 countries worldwide that fully aligned their national budget measures to the SDGs agenda.
Enabling SMEs to adopt ESG and sustainable goals
Tengku Zafrul stated that the second primary strategy would be to enhance the capacity of small and medium enterprises (SMEs) to be one of the key building blocks in order to achieve the nation’s ESG goals and the net zero-carbon goals by 2050.
He explained that the recently launched Principles for Good Governance (PGG) will be implemented by government-linked investment companies (GLICs) and through it, the aim is to catalyse the adoption of ESG practices by SMEs as well.
The third primary strategy is through the government creating the Malaysia Sustainable Development Goals Trust Fund (MySDG Fund) in partnership with the UN in Malaysia.
The minister affirms that the country will continue to enable the implementation of ESG-focused development projects and programmes in the recently released pre-budget statement for the upcoming Budget 2023.
“We have established a few key targets, including the country’s strategic shift from the present recovery phase to reforms with longer-term focus,” he continued.
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