No Bailout for Malaysia Airlines, Focus is on Economic Recovery.

Kuala Lumpur, Wednesday 8 Oct 2020 – YB Senator Tengku Dato' Sri Zafrul Tengku Abdul Aziz, the Minister of Finance, has declared that the government will not be providing financial relief nor debt guarantees to Malaysia Airlines. Support measures for the national airline will need to be addressed by its shareholder, Khazanah Nasional, and not the government.

Zafrul was interviewed live on BFM89.9’s The Breakfast Grille this morning, answering pressing questions about Malaysia Airlines’ predicament, the end of the loan moratorium, potential taxation measures, Budget 2021 and his political affiliation.

With the government’s debt and contingent liabilities at the RM1.2 trillion mark, a situation worsened by lower contributions from petroleum taxes and dividends, the Ministry of Finance will be looking at how to increase government revenue. Although the reintroduction of GST and inheritance tax aren’t completely dismissed, the Ministry’s focus will be on optimising the current tax structures first: Reducing leakages, disincentivizing the shadow economy and improving collection. The contraband cigarette industry was singled out as a problem area, which requires involvement by enforcement agencies. As to broadening the tax base further, the Minister stressed that timing is important, alluding that the current economic conditions are not conducive to new taxes.

With regards to the end of the loan moratorium period, the Finance Minister said that banks should not impose more onerous conditions on borrowers, as it goes against the spirit of government recovery measures. Banks should provide fair assistance to borrowers seeking aid.

When asked about his own political career, Zafrul said he was not interested in joining any political party. He asserted, “The focus today, and why I am here [at the Ministry of Finance] is to help stimulate the economy towards a path of recovery”.

The BFM interview with YB Senator Tengku Dato' Sri Zafrul Tengku Abdul Aziz was conducted by Noelle Lim, who can be contacted at producers@bfm.my.