By Nor Baizura Basri
KUALA LUMPUR, Oct 9 (Bernama) -- The 2027 Budget provides a fair and equitable share for citizens from all strata of life, despite the government navigating a tough global landscape, as it is fully cognizant of the challenges ordinary people face in their everyday lives.
It was certainly not a one-year plan but a caring and continuous effort by the MADANI government over the past five years, with reforms having started in 2023 to provide greater latitude for the rakyat to experience a better life amid rising costs.
Aligned with the theme “Reaching for the skies, while anchored on our values”, Prime Minister Datuk Seri Anwar Ibrahim emphasised when presenting the 5th MADANI Budget that the measure of a budget’s worth is not the thickness of the document, the size of the allocations or the number of announcements made.
It was essential that the measures implemented would provide significant benefits, allowing people to lead more dignified lives while also establishing a foundation for a better quality of life for future generations.
This perspective was shared by Anwar, who also serves as the Finance Minister.
Crucial sectors like education, health and defence continue to be the biggest beneficiaries of the RM459.8 billion allocation for Budget 2027 by the government.
A further RM50.2 billion comes from government-linked investment companies (GLICs), public-private investment and Minister of Finance (Incorporated) (MOF Inc) companies, making the Budget 2027 worth a total of RM510 billion.
In light of the war between the United States and Iran that erupted in February this year, the impact on the prices of goods has been significant, affecting not only industries but also the daily lives of people worldwide.
Aware of how Malaysians were impacted, the government consistently acted swiftly to alleviate the situation and reduce their burden by giving back the fruits of economic growth as direct, tangible benefits to the masses as per the foundations of Budget 2027.
This time, more segments of society are included, such as the middle-income group (M40), in addition to the Bottom 40 per cent of Malaysian households group (B40), youths, senior citizens, persons with disabilities, and students.
To enhance the nation’s competitiveness, Anwar consistently stressed that narrowing the gap between productivity and workers’ wages remains a priority.
This was further addressed in the Budget when the minimum wage was increased from RM1,700 to RM2,000, which would take effect from June 2027, benefiting four million workers.
However, an exception was given to micro, small and medium enterprises (MSMEs) with annual sales below RM50 million, which are still struggling with the aftermath of high prices from the West Asia crisis.
This creates huge relief for the affected segments.
Around 600,000 gig workers, who comprise e-hailing and p-hailing drivers, also benefit from the more comprehensive approach by the MADANI government and could be the next segment enjoying the minimum income rate.
The government’s magnanimity was telling when it partnered with e-hailing platform provider Grab to co-fund an RM160 million package aimed at boosting net income and improving the welfare of e-hailing and p-hailing workers starting next year.
The individual tax relief limit, which has not been reviewed since 2010, has been increased to RM12,000 from RM9,000, benefiting the M40 group, giving more cash in hand as they grapple with the rising cost of living.
As for high-income earners with annual income exceeding RM1 million, the rate will be adjusted to 30 per cent from the current 28 per cent.
Companies were also not forgotten, with new companies under the Global Services Hub (GSH) incentive enjoying a special five per cent tax rate on income from GSH activities from Jan 1 next year, while income tax exemption extended until Dec 31, 2030, for individual investors via Equity Crowdfunding (ECF) platforms and angel investors funding early-stage technology start-ups.
To encourage the use of electric vehicles (EVs) and protect the environment, the government extended the green tax incentives until the end of 2030, offering up to 100 per cent investment tax allowances for green projects and EV charging stations.
To encourage greater usage of green technology, companies purchasing such assets for their own use will also qualify for investment tax allowances of up to 100 per cent.
The government’s kind-heartedness was also evident when it drafted a Senior Citizens Bill to address abandonment and strengthen the comprehensive care ecosystem as the country is projected to enter an aged nation by 2048.
This is in view that those aged 65 and older make up to 14 per cent of the population.
In addition, assistance for senior citizens will be increased to RM1.3 billion, benefiting nearly 200,000 elderly individuals.
Not to be forgotten, 1.3 million civil servants at Premier Grade B and below will receive special financial assistance of RM1,500, including contract appointees, as well as special financial assistance of RM750 to one million government retirees, including pensionable and non-pensionable veterans.
This is among many notable measures, as Budget 2027 is anchored on eight key pillars, namely addressing the people’s cost of living; prioritising all states; safeguarding the welfare of all Malaysians; improving the quality of public services; ensuring the nation’s supply security and preparedness; pushing the boundaries of the country’s economic potential; preserving the nation’s identity and heritage; and managing public funds with integrity and accountability.
Continuous reforms initiated in 2023 have laid a strong foundation for these initiatives. This progress is supported by positive economic indicators, and we hope it continues to thrive in the coming years.
Like what Anwar said: "A truly successful economy, then, is not one that merely grows, but one that answers to the lives of its people.
"So, our question is not simply how large an economy we wish to build, but whether that growth opens room for families to save, for workers to earn more dignified wages, for small businesses to keep growing – and for every one of them to reach for the skies while staying rooted to the ground.”
-- BERNAMA