9 April 2020, Thursday | 12:58pm

Malaysians need cash injections now to survive Covid-19 economic disaster

2020-03-20

COMMENTARY, March 20 — The government needs to put cold hard cash into the rakyat’s hands today. Right now.

Freezing the monthly tax deductions (PCB) is a start, followed by freezing the CP204 advance tax paid by businesses. Next, the government should reverse all the PCB and CP204 paid for the last 12 months.

This is a measure that is easily within the government’s ability. There’s no need for people to apply for anything, qualify for anything, to find the right form. Just press the button, and send that money back to where it came from in this dire time of need.

Reversing PCB directly to the employees will put money in their pockets, to use on their children, on sick parents, on paying for necessities for the next few months. Reversing the CP204 will allow businesses to keep paying wages and salaries, to pay suppliers so that they in turn can pay their wages and salaries and pay their suppliers.

This is one way of cutting the impact of a cash crunch. The first stimulus package of RM20 billion was probably adequate at the time then-prime minister Tun Dr Mahathir Mohamad announced it.

The recent addition of another few billion ringgit announced by Prime Minister Tan Sri Muhyiddin Yassin will not really make a difference. The lockdown has changed everything.

The most immediate measures that will bring relief is to stop sucking cash out of the economy and out of businesses’ accounts. This cash should stay in the economy and be used to keep people alive. Don’t let “experts” tell you anything different.

Without a cash injection, there will be widespread failure of businesses. Many small businesses will fail, and with them that part of the economy that they keep alive — small hawkers who pay dishwashers a daily wage, small firms who pay dispatch riders and cleaners and newspaper delivery men.

If anything, the government should consider giving an immediate increase in salary to the people on the front lines, especially those on the lower pay rungs. All the emergency personnel — police, Bomba, paramedics, nurses, orderlies, hospital staff and assistants — they should be paid more.

Do not talk about raising government revenue, do not talk about 1MDB bonds, do not talk about deficits. Talk about reassuring people that you know what you’re doing, and you know what the economy needs and immediate cash injection.

Do not talk about whether the government can afford it. To quote Nobel Laureate Joseph Stiglitz, the American economist: “When the US was attacked during the Second World War, no one asked, ‘Can we afford to fight the war?’ It was an existential matter. We could not afford not to fight it.”

What is the government for if not for this, to help us shoulder the burden of tough times? Why do we pay taxes if not to have a leader who will pull us all together and bring us through the coming adversity?

Source: MALAYMAIL

 

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