KUALA LUMPUR: Prime Minister Datuk Seri Najib Razak will present the 2015 Budget on Friday. Below are some items expected by analysts compiled from research notes and media reports.

Targeted fuel subsidy scheme

A reform of the fuel subsidy regime could be announced in order to move away from a blanket subsidy for all consumers in favour of a system that benefits lower- to middle-income earners. Minister in the Prime Minister's Deparment Datuk Seri Abdul Wahid Omar has said private firms have submitted proposals for fuel prices to be charged based on income levels, vehicle types and engine capacities.

Further subsidy cuts

The government may look to reduce subsidies on essential food items such as flour and cooking oil, as well as household gas, said RHB Research.

More exemptions from GST

The Goods and Services Tax will be implemented in April next year at a rate of six per cent. Fresh food, public transport, education fees and healthcare are currently exempted. Maybank Investment Bank Research expects the government to announce an amended list that may include more exemptions.

Operational expenses

The Fiscal Policy Committee may introduce measures to contain the size of the civil service and limit the portion of total operating expenses that salaries take, said RHB Research.

Aids, higher minimum wage

Bantuan Rakyat 1Malaysia (BR1M), a programme to hand out cash assistance to households earning less than RM4,000 a month and individuals earning less than RM2,000, could be increased by RM300, said AmResearch.

The minimum wage may be raised, accompanied by measures to enhance productivity, said Hong Leong.

Property market

Exemptions on stamp duty for first-time house buyers may be extended, said Alliance DBS Research. The current incentive saves buyers 50 per cent of stamp duty costs on residential properties below RM400,000, and is due to expire at the end of this year.

Real property gains tax (RPGT) may be raised further this year, to curb speculation, said Kenanga Research.

Strong measures to curb property speculation still risk slowing down consumption and domestic demand, said Affin Investment Bank.

A GST rebate may be introduced on building materials used in the construction of medium- to low-cost properties, said MIDF Research.

Lower corporate, personal taxes

Corporate taxes may be lowered by more than the one per cent cut announced for 2016, as Malaysia's tax rates are still higher than regional peers, said Kenanga Research. Other banks predict that the government is more likely to bring forward the cut in corporate taxes rather than increase the amount of the cut.

Infrastructure spending

More funds may be allocated to improve the country's railway infrastructure and network. This includes ongoing work in Kuala Lumpur, and the planned commuter train linking Singapore to Johor Baru, said Maybank.

Higher oil royalties

The states of Sabah, Sarawak and Terengganu may be awarded higher royalties on oil production than the current five per cent, said Maybank. In May, Sarawak requested that the rate be raised to 20 per cent. Other states would expect the same treatment, said Maybank.

Islamic finance

Tax incentives could be offered to promote Islamic bonds in foreign currencies, Maybank said. Non-ringgit sukuk account for less than 10 per cent of all issuances. Reuters