Malaysia Budget 2027 made simple: the highlights on one page

Budget 2027, tabled on 9 October 2026, sets federal spending of RM459.8 billion within a RM510 billion envelope. Headline measures include a RM2,000 minimum wage from June 2027, individual tax relief raised to RM12,000, lower MSME tax rates of 14% and 16%, RM16 billion for STR and SARA, RM57 billion in loan facilities and financing guarantees for businesses, RM47.7 billion for the Ministry of Health and a RM30 million MDEC fund to help 4,000 MSMEs adopt AI.

Budget 2027 was tabled in the Dewan Rakyat on Friday, 9 October 2026, when the Prime Minister moved the second reading of the Supply Bill (2027). It now goes through parliamentary debate. Tax changes are proposed from year of assessment 2027 and need to be legislated, the minimum wage starts in June 2027, and each programme opens on its own published date. Always check the official documents and the implementing agency before acting.

Budget 2027 is the fifth MADANI Budget, themed "Reaching for the Skies, While Anchored on Our Values" (in Bahasa Melayu, "Menggapai di Langit, Mengakar di Bumi"). Prime Minister and Finance Minister Anwar Ibrahim tabled it with the Supply Bill (2027) on 9 October 2026.

Proposed from year of assessment 2027: individual relief rises from RM9,000 to RM12,000 (Appendix 2); relief for parents' and grandparents' care covers all types of care, not only medical (Appendix 3); medical relief becomes Health and Well-being, still RM10,000, now including postnatal care up to RM3,000 and breastfeeding equipment up to RM1,000 (Appendix 4); lifestyle relief stays at RM2,500 but adds AI software subscriptions for you, your spouse or child, plus pet adoption from registered shelters and registered vet vaccination and spaying or neutering (Appendix 6); sports relief adds sports shoes up to RM300 within the RM1,000 limit (Appendix 7); tourism relief of up to RM1,000 for attraction and cultural entrance fees is extended for 2027 (Appendix 8); and the RM350 SOCSO relief now covers mandatory LINDUNG Kendiri contributions in three sectors (passenger transport, goods or food transport and hawkers), plus up to RM150 more for voluntary LINDUNG 24 or LINDUNG Kendiri contributions (Appendix 9). Resident tax bands change too: 18% on RM70,001–100,000, 24% on RM100,001–150,000, and the 30% top rate starting above RM1 million instead of RM2 million (Appendix 1). All apply once legislated.

The new minimum wage of RM2,000 (up from RM1,700) takes effect from June 2027, according to paragraph 32 of the Budget speech. MSMEs with annual sales below RM50 million are exempted. Employers should check the implementing order for the final coverage before changing payroll. Separately, paragraph 32 says the government "will reform the workers' income framework, beginning with a minimum wage of 2,500 ringgit a month for semi-skilled workers and graduates". The speech gives no start date, employer coverage or exemptions for the RM2,500 rate, so wait for the implementing details.

The STR and SARA allocation rises to RM16 billion in 2027 from RM15 billion. All STR recipients get SARA of up to RM150 a month, and Malaysians aged 18 and above who are not STR recipients get RM100 on two occasions. SARA can also be used for fresh produce at 216 FAMA farmers' markets and tamu (para 26).

Yes. Special Financial Assistance of RM1,500 goes to 1.3 million civil servants at Premier Grade B and below, including contract appointees (para 192). It is paid in two instalments: before Aidilfitri and ahead of the 70th National Day (para 194). Paragraph 191 adds RM2.3 billion for quarters, a longer maternity leave entitlement and a higher minimum pension.

More than 1 million government retirees, including pensionable and non-pensionable veterans, get Special Financial Assistance of RM750, paid in the same two instalments (paras 193–194). The minimum pension rises from RM1,000 to RM1,350 a month, for nearly 59,000 pensioners, ATM veterans and derivative-pension recipients (para 191).

Paragraph 77: total aid for persons with disabilities rises to RM1.5 billion for more than 300,000 people; monthly aid for bedridden PWDs and chronically ill patients rises from RM500 to RM600; the income threshold for the Disabled Workers Allowance rises from RM1,700 to RM2,000; and the allowance for pupils with special education needs rises from RM150 to RM200 a month.

For 2027, borrowers earning up to RM2,500 a month can defer repayments, and those earning RM2,500 to RM3,000 pay a minimum of only RM50, which covers more than 400,000 borrowers. Borrowers with no arrears who repay regularly get a 10% discount, and employers who repay PTPTN loans for their staff get a tax deduction on repayments made from 1 January 2027 to 31 December 2028 (para 102).

For civil servants, yes: the total maternity leave entitlement over a career rises from 360 to 490 days, which means up to 98 days for each childbirth, and RM20 million goes to upgrading childcare centres at government facilities (para 191). The speech announces this under civil servants' well-being; it does not announce a change for private-sector employees.

Paragraph 157 announces a RM30 million MDEC fund to help 4,000 MSMEs adopt AI and automate their operations, and to train and certify 5,000 AI professionals. It is a programme-wide allocation, not an amount per business, and its terms and application dates were not set out in the Budget speech; check MDEC for them. Preparing a clearly scoped AI project now puts a business in a better position when they open.