Bersama unveils shadow budget, moots 5% GST, cash aid overhaul

Bersama, a political party, has introduced its shadow federal budget, featuring a capped 5% GST and the discontinuation of numerous cash aid programs in favor of more targeted monthly support. The party believes that a 5% GST for the following decade would provide stability for households and businesses, while limiting the tax scheme's effect on potential inflation.

According to Bersama's projections, a 5% GST could yield approximately RM76.1 billion in revenue for 2027, which is 3.3% of the GDP, compared to the RM59.4 billion expected from the 6% sales and service tax in 2026, resulting in an additional RM16.7 billion.

To replace the Sumbangan Tunai Rahmah (STR) and Sumbangan Asas Rahmah (SARA) schemes, Bersama plans to distribute RM200 monthly to the bottom 60% of households (B60). The party also suggests providing every Malaysian child under 18 with RM50 a month, limited to five children per household, with a maximum benefit of RM250 a month or RM3,000 annually per family.

The government should evaluate the potential implementation of a retail electronic payment tax (REPT) from 2027 to 2029. No REPT will be enforced during the development period; however, it could be introduced in 2030 at a rate of 0.5%, generating about RM9.1 billion annually, before considering exemptions and behavioral shifts. These measures could assist Malaysia in eliminating its fiscal deficit and achieving its first budget surplus since 1997 by 2035.