KUALA LUMPUR:  Prime Minister and Finance Minister Datuk Seri Anwar Ibrahim tabled the 2026 Budget at Parliament this afternoon.

The following are some of the highlights of the RM419.2 billion budget, the biggest in the country’s history:

■ Operating expenditure accounts for RM338.2 billion, while the remaining RM81 billion is for development expenditure.

■ Public revenue is estimated at RM343.1 billion, up from RM334.1 billion in 2025.

■ RM120 million will be allocated to protect the welfare of smallholders, and paddy farmers will get RM2.62 billion in various subsidies and assistance.

■ RM2 billion Sumbangan Tunai Rahmah (STR) Phase 4 for 2025 will be disbursed earlier starting October 18, in conjunction with Deepavali.

■ Health Ministry to get RM46.5 billion in allocation, Defense Ministry RM21.7 billion, and Home Ministry RM21.2 billion.

■ New performance-based incentive framework will be rolled out from the first quarter of 2026 for the manufacturing sector, followed by the services sector in the second quarter.

■ Companies using locally manufactured MyHIJAU Mark-certified green technology products for Own Use will be granted 100 percent green investment tax allowance.

■ RM53 million will be provided under Malaysia Digital Acceleration Grant to boost growth and adoption of technologies such as blockchain, AI and quantum computing.

■ Public university lecturers who found spin-off companies can take one-year research/sabbatical leave, to boost R&D commercialization.

■ Additional 50 percent tax deduction for SMEs on expenses for certified training related to AI and cybersecurity.

■ Malaysian Communications and Multimedia Commission (MCMC) to get RM2 billion to build sovereign artificial intelligence (AI) cloud.

■ The government will introduce the Asean Business Entity status, coordinated by the Securities Commission Malaysia.

■ 100 percent exemption on excise duty and sales tax for the purchase of Proton and Perodua cars by taxi drivers and private hire car operators.

■ RM7.9 billion set aside for technical and vocational education and training or TVET.

■ Over RM700 million will be allocated to boost tourism sector.

■ Tax deductions up to RM500,000 for renovation and refurbishment of business premises by tourism project operators. 

■ Visit Malaysia Year 2026 aims to attract 47 million visitors and generate RM329 billion in tourism revenue.

■ Special RM1,000 individual income tax relief for expenses covering entrance fees to local tourist attractions and cultural programs to encourage domestic travel.

■ Airport upgrades in Penang, Sabah and Sarawak to get RM2.3 billion, to be completed by 2028.

■ RM1 billion will be allocated to strengthen the Madani initiative for the people.

■ Companies and individuals contributing to government community programs are eligible for income tax deductions.

■ Approximately RM15.5 billion will be saved annually from the overall subsidy rationalization.

■ MyDigital ID initiative will be expanded to the financial, telecommunications, e-commerce and healthcare sectors.

■ RON95 subsidy rationalization has the potential to save at least RM2.5 billion, while diesel subsidy rationalization saves RM5 billion.

■ Parliament will receive RM220 million, with RM5 million to enhance Dewan Rakyat’s check-and-balance function over government policies.

■ Vehicle tax exemption in Langkawi and Labuan will be limited to vehicles valued at no more than RM300,000, effective January 1, 2026.

■ E-invoice initiative to be fully implemented in 2026, along with the self-assessment system for stamp duty to foster tax compliance; refunds of overpaid taxes will be expedited.

■ Deficit to be reduced from 3.8 percent to 3.5 percent of GDP in 2026.

■ 45 percent of publicly-listed companies met the 30 percent women board requirement as of October 1.

■ Double tax deduction for companies sponsoring training for people with disabilities will be extended to include sponsoring care worker training programs recognized by the Women, Family and Community Development Ministry.

■ Micro, small, and medium enterprises (MSMEs) are encouraged to adapt to technology and digitalization, with development financial institutions (DFIs) providing RM1 billion funding to support process automation and digitalization of business operations.

■ RM1,000 PERKESO incentive for new graduates or job seekers accepting offers that require them to relocate.

■ RM3.1 billion for the Social Welfare Department to assist over 560,000 recipients.

■ Another RM100 in SARA assistance for 22 million Malaysians aged 18 and above will be disbursed in mid-February 2026 to help with preparations for Ramadan and Chinese New Year.

■ All nine million Sumbangan Tunai Rahmah (STR) recipients will also receive up to RM100 per month of Sumbangan Asas Rahmah (SARA) in 2026.

■ RM12 million will be allocated to National Scam Response Center.

■ Malaysia’s hardcore poverty rate has dropped to just 0.09 percent for the first time in history, or around 7,000 households nationwide.

■ The RM3,000 individual income tax relief for daycare or kindergarten fees for children up to six years old will be extended to include registered daycare or transit centers for children up to 12 years old.

■ RM210 million for MCMC to develop Early Warning System (EWS) to improve disaster and crisis readiness.

■ Establishment of Cyber Security and Cryptology Development Center (CSCDC) by National Cyber Security Agency (NACSA) to strengthen the country’s digital sovereignty and cyber security.