I’ve just skimmed through the highlights, and it looks like we have a mildly expansionary budget this year with lots of things to cheer about. Here are some of the notable changes announced for Malaysia’s 200 Budget:

Corporate tax cut  of 2% – to be implemented over two years: 2007 – 27%, 2008 – 26%. Very sweet! 🙂 (Some say that this may be followed shortly by tax cuts on individual tax rates). This is made all the more amazing in that Malaysia has not seen a corporate tax cut in 9 years.

REITs – for a 5 year period, local and foreign individual investors now subjected to a final 15% witholding tax on dividends received. Foreign institutional investors subjected to a final withholding tax of 20%, compared to 28% previously

Further allocations to public transport and edcuation, areas near and dear to the PM’s heart

Development spending increased by 31% to further help bring the construction industry out of the doldrums

Various other incentives to further enhance growth of Islamic banking, biotechnology and agricultural sectors and to further promote the overseas expansion of local banks.

Personal relief for resident individuals on the purchase of books increased to RM1,000 from RM700 previously

Rebate on purchase of personal computer of RM500 replaced by personal relief of RM3,000 claimable once every 3 years

The budget deficit will be further reduced to 3.4% in 2007.