The emergence of the M40 category is an astute move by the prime minister who responded to the feedback on addressing the rising cost of living for the middle-class group, said a tax consultant.

M40 refers to the middle 40 percent with household income of between RM3,860 and RM8,319.

"I think it's an astute move by the prime minister as he has extensively canvass the feedback from outside and realises the middle-class also needs help," PricewaterhouseCoopers Capital Sdn Bhd's (PWC) executive director, Patrick Tay Soo Eng told Bernama .

In Budget 2016, Najib Abdul Razak had said that the definition of M40 would be further reviewed from time to time.

For Tay, the budget has a public-centric and holistic approach responding to all five of the government’s objectives.

These objectives encompass strengthening economic resilience, ensuring inclusiveness, enhancing human capital and increasing productivity, innovation and green technology, as well as safeguarding the well-being of the rakyat.

As to whether the budget allocation augurs well for the 11th Malaysia Plan (11MP, 2016-2020), Tay said it really was an important budget, being the first allocation to carry out the intentions of the 11MP.

"I believe the initiatives are there, however, I think the budget speech probably was restricted by time, as some of the measures were not articulated out.

"It is really important that over the next two or three weeks, the government needs to articulate the reasoning and rationale behind some of the initiatives," he said.

Haze of economic uncertainty

In assessing the budget, he said it was clear on measures to improve productivity and competitiveness as well as ways to relieve the people’s burden, but was a little less clear on whether it had given investors and decision-makers a clear path through the haze of economic uncertainty.

On the economic outlook for 2016, Tay said, "it will be challenging because in this globally connected world, we will feel the economic rebalancing China is going through and we are going to experience the fluctuations of the currency and lower commodity prices.

"While challenging, it's not all doom and gloom as what the prime minister said in Budget 2016, Malaysia has got a strong base of growth, a strong programme of infrastructure spending, right economic fundamentals and most importantly, good businesses and good workers in the country.

"Amid the challenge, we (Malaysians) should buck ourselves up to get through this stronger and be more resilient," Tay added.

- Bernama