Prime Minister Anwar Ibrahim today presented the Belanjawan 2026 (Budget 2026) in Parliament, outlining a RM470 billion spending plan themed Belanjawan Rakyat (“People’s Budget”) that aims to ease living costs while driving economic reform and fiscal sustainability.
Among all the changes and new incentives, people are most excited about a new round of SARA national assistance programme, coming February 2026. Details have not yet been announced, so it remains unclear whether it will follow exactly the same format as the current MyKasih rollout.
Another notable new measures is the vehicle scrappage incentive, where owners of cars aged 20 years or older can receive up to RM4,000 if they scrap their old vehicles and purchase a new locally made car. Introduced in partnership with national automakers, the initiative seeks to improve road safety, reduce emissions, and boost demand in the local automotive industry.
The budget also expands the Rahmah Cash Aid (STR) and Rahmah Basic Subsidy (SARA) schemes, allocating RM13 billion to assist lower-income households.
In addition, the government will accelerate the digitalisation of tax administration, with electronic invoicing and digital stamp duty systems set for full nationwide rollout in 2026.
Motorists will enjoy 50% toll discounts during the Deepavali holidays, while buyers of Proton or Perodua vehicles for taxi or e-hailing use will receive tax and road fee exemptions.
To stimulate local tourism, individuals can claim up to RM1,000 in personal income tax relief for spending on domestic travel and cultural events.
Tax deductions on insurance and takaful premiums will be expanded to cover children, and parents will receive higher childcare tax relief.
The budget also includes a 10% increase in alcohol excise duty starting November 2025, alongside a phased rise in tobacco taxes, as part of the government’s public health initiative.
More than RM200 million will be allocated to improve nationwide public transport services and upgrade road infrastructure, particularly in rural and high-risk areas. Healthcare-related tax deductions will be widened to include certain medical treatments and vaccination costs.
Beyond short-term financial aid, Belanjawan 2026 reflects Anwar’s broader reform agenda — strengthening governance, tightening fiscal discipline, and implementing long-term structural changes to build economic resilience and sustainability.
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