PUTRAJAYA: The federal government expects the fiscal deficit to remain at 2.8% of Gross Domestic Product (GDP), says Finance Minister Lim Guan Eng.



He told a press conference on Thursday that the project fiscal deficit will increase to RM40.1bil from RM39.8bil, which would maintain the fiscal deficit at 2.8%.



In addition, the government’s current balance (government revenue less operating expenditure) will also remain positive.

Separately, Lim said the zero GST, which comes into effect on Friday, will “return” about RM17bil back to Malaysians for the rest of the year.

He also said that the stabilisation of RON 95 petrol at the current RM2.20 per litre and diesel at RM2.18 per litre will save Malaysias RM3bil.



As part of the reallocation of expenditure priority, the Pakatan Harapan government will review, defer and renegotiate “at least RM10bil worth of identified high-priced projects”.



The projects include a RM350mil contract to renovate and repair the Sultan Abdul Samad building in Kuala Lumpur.



Lim also told the press conference that the government would reviews the Bandar Malaysia project.



The government has also already announced the termination of the High Speed Rail between Kuala Lumpur and Singapore as well as the MRT3.



As for the government’s revenue stream, it will achieve additional revenue from the higher oil price.



An estimated RM5.4bil from the rise of oil prices from the US$52 per barrel used in the Budget 2018, to the current price of US$70 per barrel.



The amount would come from the corporate and petroleum income taxes from the oil companies operating in Malaysia.



The government sees RM5bil in revenue from higher dividends from the government-linked companies.



It also expects RM4bil from the Sales and Services Tax (SST).