Budget 2027: More disposable income for Malaysians, up to RM1,600 thanks to tax reliefs, reductions

KUALA LUMPUR, Oct 9 — According to Prime Minister Datuk Seri Anwar Ibrahim's Budget 2027 speech, Malaysians can anticipate an additional RM1,600 in disposable income, thanks to higher tax relief and lower tax rates. Anwar highlighted several tax measures that would benefit Malaysians, particularly the middle class or M40 group. The increase in tax relief and reduction in individual tax rate would provide extra disposable income of up to RM1,600 to approximately five million taxpayers, he stated.

Key tax measures include raising individual tax relief from RM9,000 to RM12,000 and decreasing the income tax rate by one percentage point for those residing in Malaysia. Furthermore, the federal government plans to expand individual tax relief to cover a wider range of expenditure categories, such as post-delivery care services, care expenses for parents and grandparents, tuition for children, sport shoe purchases, AI subscriptions, and vaccination costs.

The government also intends to adjust the tax rate to 30% for individuals with income exceeding RM1 million.