A grand Malaysian institutional building with a sweeping arched façade and three Malaysian flags hanging at its centre

Cost of Living

Tabled 9 October

Budget 2027 Malaysia Summary: RM459.8 Billion, a 1-Point Income Tax Cut, RM16 Billion STR and SARA

RaymondRates.myPublished 9 October 2026, 8:48 PM MYT4 min read

Prime Minister Anwar Ibrahim tabled Budget 2027 (Belanjawan 2027) in the Dewan Rakyat on Friday, 9 October 2026. Every figure below comes from the speech itself.

How big is Budget 2027 Malaysia?

RM459.8b

federal spending 2027

operating + development

3.3%

fiscal deficit target 2027

3.6% in 2026; 3% by 2028

4.2–5.2%

GDP growth forecast 2027

4.8–5.3% expected for 2026

The RM510 billion the Prime Minister announced adds three investment streams to the RM459.8 billion federal budget. Source: Budget 2027 speech, para 186.

Debt falls to 63.7% of GDP in 2027, from 65.2% in 2025, with new borrowing controlled (para 190).
Revenue is forecast at RM380.8 billion next year, after 2026 beat its original estimate by RM20.5 billion (para 187).

What are the Budget 2027 income tax changes?

RM12,000

individual tax relief cap

RM9,000 since 2010

RM1,600

max extra disposable income

about 5 million taxpayers, per MOF

YA2027

first year of assessment affected

income earned in 2027, filed in 2028

Chargeable income	Rate now	Rate from YA2027
RM70,001 – 100,000	19%	18%
RM100,001 – 150,000	25%	24%
RM150,001 – 400,000	25%	25%
RM600,001 – 1,000,000	28%	28%
RM1,000,001 – 2,000,000	28%	30%
Above RM2,000,000	30%	30%

Only the bands that move are shown; everything below RM70,000 is unchanged. Source: MOF, Langkah Cukai Belanjawan 2027, Lampiran 1. See what the new rates do to your take-home pay.

New reliefs cover postnatal care, parent and grandparent care, sports shoes, children’s tuition and AI subscriptions (para 29).
Socso relief now includes compulsory Lindung Kendiri contributions, plus up to RM150 for voluntary cover (para 34).

How much STR and SARA cash aid is there in 2027?

RM16b

STR + SARA allocation 2027

RM15b in 2026

RM150

max SARA a month for STR recipients

up to RM1,800 a year

RM100 × 2

SARA MADANI for non-STR adults

before Aidilfitri and the 70th Merdeka

Up to 9 million STR recipients get monthly SARA; 13 million other adults, M40 included, get MADANI payments.
SARA now buys wet and fresh goods at 216 FAMA farmers’ and tamu markets, beyond 15,000 partner shops.

What do civil servants, pensioners and minimum-wage workers get?

A calculator, pen and Malaysian ringgit notes on a desk — The RM1,500 and RM750 special payments are one-off. The RM2,000 wage floor and the RM1,350 minimum pension are permanent. · Photo: Unsplash

Who	What changes	Reach
Civil servants, Grade Utama B and below contract appointments included	RM1,500 one-off	1.3 million
Government pensioners veterans included	RM750 one-off	over 1 million
Minimum pension a month	RM1,000 → RM1,350	nearly 59,000
Minimum wage from June 2027	RM1,700 → RM2,000	over 4 million workers
Semi-skilled and graduate wage floor “as a start”, per the speech	RM2,500 a month	not stated
GLIC and GLC living-wage benchmark a month	RM3,100 → RM3,400	230,000 workers
Civil-service maternity leave over a whole career	360 → 490 days	max 98 days a birth

Listed in the order the speech announced them. Source: Budget 2027 speech, paras 33 and 191–194.

Both special payments come in two tranches, before Aidilfitri and ahead of the 70th Merdeka anniversary (para 194).
MSMEs with sales under RM50 million are exempt from the new wage floor while they adjust (para 33).

What changes for EPF, PTPTN and gig workers?

Who	What changes	Speech
EPF membership	Automatic for every citizen at 18	para 35
EPF members at 55 and 60	Option of i-Emas monthly withdrawals	para 76
E-hailing and p-hailing drivers	EPF matching up to RM600 a year, RM6,000 lifetime	para 34
PTPTN, earning up to RM2,500 a month	Repayment deferred for 2027	para 102
PTPTN, earning RM2,500 – 3,000	Minimum repayment RM50 a month	para 102
PTPTN, no arrears, regular repayment	10% discount	para 102
Gig workers starting a business or buying a first home	RM270 million financing via BSN and Agrobank	para 34

Listed in the order the speech announced them. Rates.my’s EPF guide covers the current withdrawal rules.

No new contribution rate comes with auto-registration; the speech says only that saving should start earlier (para 35).
Over 400,000 PTPTN borrowers qualify; employers repaying loans on staff’s behalf get a tax deduction until 2028 (para 102).

Petrol, electricity and first homes: what else is in Belanjawan 2027?

Cars on a Malaysian highway at dusk — Fuel subsidies are the single biggest line inside the RM80 billion-plus the government will spend on subsidies, aid and incentives next year. · Photo: Unsplash

RM40b

fuel subsidy in 2027

“expected to stay high”, para 25

800 kWh

electricity-bill protection threshold

up from 600 kWh since September

RM500k

first-home price with full stamp-duty exemption

to RM750k: first RM500k free, half off the rest, 2027–2030

BUDI95 stays at 300 litres monthly, BUDI Diesel at 400; both rose in September, not today (para 24).
SJKP will guarantee up to RM20 billion of home loans for 80,000 first-time buyers, mainly self-employed people (para 55).

What to watch

Oct–Nov 2026The Supply Bill 2027 is debated and voted on in the Dewan Rakyat. Every measure above is a proposal until it passes.
5 Nov 2026Bank Negara’s next MPC meeting, the first since Budget Day.
1 Jan 2027The stamp-duty window for first-home agreements opens, and the lower elderly-care service tax of 6% starts.
Before Aidilfitri 2027First tranche of the civil-servant and pensioner special aid, and the first SARA MADANI payment.
June 2027The new minimum wage takes effect for employers outside the MSME exemption.
2028The tax cut and the higher relief first show up in the return you file for income earned in 2027.

Not financial advice. This is general information from the Budget 2027 speech (Ucapan Belanjawan 2027) and the Ministry of Finance’s tax-measures annex, both read live on 9 October 2026, cross-checked against same-day reporting by Bernama, The Star, The Edge and Free Malaysia Today. The measures are proposals until the Supply Bill passes Parliament, and Rates.my does not give tax or investment advice. Confirm your own position with LHDN or a licensed adviser.

Sources & further reading

Ready to act on this?

Park your Budget 2027 tax saving: compare FD rates

Keep reading

Cost of LivingWhen Is Malaysia's Budget 2027, and What Do We Already Know?Cost of LivingMalaysia Public Holidays 2027: All 15 Federal Dates, and What a Day Off Really Costs Cost of LivingDiesel Subsidy, Cash Aid & the Election Question: What Malaysia's 2026 Money Moves Mean for You

💬 Market Chat

Join the discussion — share your take on this with other Rates.my readers.

💬 Discussion

Your rating:

(optional)

Be respectful. Not financial advice.

Loading discussion…

This article is general information, not personalised financial advice. Rates.my is not a licensed financial adviser — always verify rates with the institution and consider your own circumstances.

← All insights