What you need to know about Malaysia Budget 2026.

The Malaysian government has tabled Budget 2026, outlining measures to ease living costs, strengthen the economy, and improve public welfare. Here’s a quick summary of the key highlights that may impact you.

 

Higher Government Spending, Revenue & Fiscal Measures

  • The federal government’s operating & development expenditure is projected at RM419.2 billion, excluding off-budget investments.
  • Overall budget size (including public-private and GLIC investments) is cited around RM470 billion — making it Malaysia’s largest budget yet.
  • Revenue forecast is RM343.1 billion, up from about RM334.1 billion.
  • The fiscal deficit is targeted to narrow to 3.5 % of GDP (from ~3.8 %).

 

Property & Housing

  • First-home buyers will continue to enjoy full stamp duty exemption for properties priced up to RM500,000, extended until 31 December 2027.
  • A flat stamp duty rate of 4–8% will apply to property transfers involving foreign individuals and companies (excluding permanent residents).
  • The LPPSA home financing limit is proposed to increase to RM1 million, reflecting rising salaries and property prices.

 

Vehicles & Transport

  • Car owners who scrap vehicles over 20 years old will receive up to RM4,000 matching grant when buying a new national car.
  • The Consumer Protection Act will be amended to introduce a “Lemon Law”, protecting consumers from defective new vehicles.

 

Tax Reliefs & Personal Incentives

  • The RM3,000 tax relief for life insurance or takaful premiums (for self and spouse) will now include policies for children.
  • Childcare and kindergarten tax relief of RM3,000 will be expanded to cover daycare and after-school transit centres, and extended to children up to 12 years old (previously 6).
  • New RM1,000 tax relief is introduced for entrance fees to local tourist attractions and cultural programmes.
  • The RM2,500 tax relief for green appliances expanded e.g. covers food waste grinders

 

Excise Duties & Taxes

  • Excise duties on alcohol will rise by about 10%, effective 1 November 2025.
  • Tobacco excise duties will also be increased starting 1 November 2025:
    • Cigarettes: excise duty will increase by 2 sen per stick.
    • Cigars, cheroots, cigarillos: duty will increase by RM40 per kg.
    • Heated tobacco products: duty will go up by RM20 per kg of tobacco content

 

Healthcare

  • The public healthcare budget will increase to around RM46.5 billion.
  • GP consultation fees will be revised to a range of RM10–RM80.
  • Doctors’ on-call allowances will increase by about 40% beginning October 2025.

 

EPF

  • EPF withdrawal for Hajj will increase to RM10,000 (up from RM3,000).
  • A new EPF i-Saraan Plus will be launched for gig and self-employed workers, offering a RM600 annual government match, capped at RM6,000 lifetime. (The existing i-Saraan scheme with RM500 matching and RM5,000 lifetime limit will continue.)

 

Other Key Announcements

  • Employment contracts must be stamped starting 1 January 2026. The salary threshold for exempting employment contracts from stamp duty will be for pay above RM3,000/month.
  • PTPTN borrowers overseas who are able to repay but have not will face a review of travel restrictions.
  • Under SARA 2026, all Malaysians aged 18 and above will receive a RM100 credit via MyKad, redeemable at selected outlets starting mid-February 2026.

 

Summary

Budget 2026 focuses on homeownership support, consumer protection, expanded tax reliefs, and stronger social safety nets. While some taxes are rising, especially on alcohol and tobacco, the overall direction aims to balance economic growth with public well-being.