Government Expenditure

Government spending stimulates economy, says Wee KUCHING: Government spending is a catalyst to generate multiplier effect in boosting economic activities, said president of Associated Chinese Chambers of Commerce and Industry of Sarawak (ACCCIS) Datuk Wee Kok Tiong. He believed that such move would not only increase aggregate demand but also attract more private investments and domestic consumption, which would contribute to gross domestic product (GDP) growth. Many people are concerned about the rising debt to GDP in view of the increasing government spending. However, government spending is necessary to spur economic activities. Base on the article above, government spending will boost the economy of the country because the more government spends the higher national level of equilibrium income. Besides that, government spending value will be more independent on the level of income.

Generally, all income of companies and individuals accrued in, derived from or remitted to Malaysia is liable to tax. However, income remitted to Malaysia by resident companies (other than companies carrying on the business of banking, insurance, air and sea transportation), nonresident companies and non-resident individuals are exempted from tax.
Read more on: http://www.theborneopost.com/2013/06/23/government-spendingstimulates-economy-says-wee/