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

KUALA LUMPUR, Oct 9 — Malaysians are set to enjoy an extra RM1,600 in disposable income due to tax reliefs and reduced tax rates, according to Prime Minister Datuk Seri Anwar Ibrahim's Budget 2027 address. The Prime Minister highlighted several tax measures aimed at benefiting Malaysians, particularly those in the middle income bracket or M40 group.

This adjustment is expected to provide additional disposable income to approximately five million taxpayers, as stated in the speech. Key changes include raising the individual tax relief from RM9,000 to RM12,000, and lowering the income tax rate by one percentage point for those living in Malaysia. Anwar also revealed plans to expand tax relief to cover a wider range of expenditures, such as post-delivery care, care costs for parents and grandparents, children's tuition, sports shoe purchases, AI subscription fees, and vaccination expenses.

Additionally, the federal government plans to adjust the tax rate to 30 percent for individuals earning more than RM1 million annually.