KUALA LUMPUR, June 18 (Bernama) -- Bursa Malaysia’s key index finished marginally higher, supported by strong buying interest in consumer-related counters, amid mixed performance across regional markets. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose by 1.40 points, or 0.08 per cent, to 1,711.39 from Tuesday's close of 1,709.99. The key index opened 12.36 points firmer at 1,722.35 and moved between 1,711.31 and 1,722.63 throughout the session. Market breadth was negative, with losers leading gainers 678 to 493, while 549 counters were unchanged, 1,016 untraded and 34 suspended. Turnover increased to 4.50 billion units worth RM3.45 billion from 3.93 billion units worth RM3.45 billion on Tuesday.
Japan’s ruling coalition failed to gain the support of a key opposition party, threatening Prime Minister Shigeru Ishiba’s ability to pass the 2025 state budget and tax reform bills through parliament.
Key Highlights
1. Income Tax Threshold Dispute
- Proposed Threshold: The ruling Liberal Democratic Party (LDP) and coalition partner Komeito suggested raising the tax-free income threshold from ¥1.03 million to ¥1.23 million, the first adjustment since 1995.
- Opposition’s Demand: The Democratic Party for the People (DPP) is pushing for a much higher threshold of ¥1.78 million to better address rising living costs.
- DPP’s Stance: "With the planned ¥1.23 million threshold, there is no way for us to support the state budget," said DPP lawmaker Yuichiro Tamaki.
2. Revenue Implications
- Proposed Hike Impact:
- LDP's plan: Reduce tax revenue by ¥700 billion.
- DPP’s demand: Estimated revenue reduction of ¥8 trillion, exacerbating Japan’s significant public debt.
3. Broader Tax Reform Measures
- The coalition’s tax reforms also include:
- Corporate and Tobacco Tax Increases: Set to begin in April 2026 to fund defence spending.
- Defence Spending Target: Doubling to 2% of GDP by 2027, a continuation of former Prime Minister Fumio Kishida’s commitment.
4. Legislative Challenges
- The ruling coalition lost its majority in the October snap election, leaving it reliant on opposition parties like the DPP to pass key legislation.
- Next Steps: The cabinet is expected to approve the tax reform framework next week, forming the basis for the 2025 state budget.
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