Published after the tabling on 10 October 2025. Use this as a 12-month field guide; we flag effective dates and action items where possible.
Executive summary
Belanjawan MADANI 2026 pushes three big levers: (1) targeted household support (notably fuel), (2) industry-focused incentives tied to tourism, energy transition and high-value investments, and (3) compliance upgrades (e-Invois, digital tax stamps, stamp-duty self-assessment). A carbon tax begins next year with an initial scope on iron/steel and energy, aligned to a forthcoming National Climate Change Bill and carbon market policy. For readers skimming today or six months from now: focus on what’s effective 1 January 2026, what needs internal process changes, and where tax reliefs can be captured quickly.
Budget context at a glance
- Total public outlay 2026: RM470b across operating, development and public investments, with continuing fiscal-discipline targets (deficit guided toward 3.5% in 2026).
- Government messaging emphasizes raising revenue via governance and subsidy retargeting, instead of broad new taxes on households.
Incentives for individuals (what you can claim or plan around)
- Tourism & culture relief for 2026: Special personal income-tax relief up to RM1,000 on admission fees to local attractions and cultural programs in conjunction with Visit Malaysia 2026. Action: Keep receipts; this is a targeted, time-bound relief for YA 2026.
- Lifestyle relief broadened (sustainability): The RM2,500 lifestyle relief is proposed to cover food-waste shredders to encourage sustainable habits. Action: If you’re upgrading appliances, check product classification and proof of purchase.
- Targeted RON95 fuel (BUDI95): Headline pump price RM1.99/L for eligible Malaysians; database expansion includes registered boat owners and active e-hailing drivers. Action: If you’re newly eligible, confirm your registration/appeal path early.
Incentives for industries (by cluster)
Tourism, events, arts & sports (Visit Malaysia 2026)
- >RM700m sector push, including RM500m campaign funding, RM60m for promotions, RM50m for arts & heritage incomes, RM50m airline incentives, upgrades at UNESCO sites, and medical tourism support. Action: Align marketing and event calendars to funding windows.
- Tax measures (company-side):
- Capex refresh deduction up to RM500k for tourism premises;
- 100% income-tax exemption on incremental inbound tour income;
- 100% exemption for international MICE organizers;
- 50% exemption for international arts/culture/sports event organizers. Action: Prepare before/after revenue tracking to substantiate “incremental” income.
Green transition & efficiency
- GTFS 5.0 (open through 31 Dec 2026): government guarantees up to 80% (waste tech) / 60% (other green sectors); RM1b financing room. Action: Map projects to eligible technologies and bank partners early.
- Solar ATAP enables self-generation and sale of excess power (offsets on electricity bills). Action: Consider rooftop PV feasibility studies; track metering rules.
Halal ecosystem
- SME Bank: RM100m dedicated financing; SJPP guarantees lifted to RM2b; new Perak Halal Industrial Park in Manjung (RM124m). Action: If you’re exporting, align certification and financing applications now.
Investment facilitation & talent mobility
- ASEAN Business Entity (ABE) status (SC-coordinated) to smooth regional operations for listed and mid-tier firms; Investor Pass (MIDA) with Multiple Entry Visa up to 12 months; Residence Pass–Talent Fast Track continued. Action: Legal teams should review group structures and mobility policies to leverage ABE/Pass benefits.
- Outcome-based tax incentive framework: pilot ends 2025; full rollout from Q1 2026 (manufacturing) and Q2 2026 (services). Action: Re-model investment cases around performance-linked metrics.
New taxes
- Carbon Tax (from next year) — initial scope: iron/steel and energy. Mechanism to be aligned with the National Carbon Market Policy and a forthcoming Climate Change Bill. Action: Map emissions sources, gather activity data, and ready cost-pass-through models now.
New laws & legal reforms to watch
- Separation of the Attorney-General & Public Prosecutor — now in stakeholder engagement.
- Admiralty Jurisdiction Bill and Coroners Bill — in the law-reform pipeline.
- Consumer Protection Act to be amended to add “Lemon Law” elements (post-CCA). Action: For product sellers and financiers, anticipate stronger consumer remedies and returns/warranty standards.
Exemptions introduced / continued
- Taxi sector: continued 100% excise-duty and 100% sales-tax exemptions for new national cars (Proton/Perodua) for taxi/individual-hire use; plus HRD Corp training support (RM10m). Action: Operators should schedule fleet refresh and apply training claims.
- Employment contracts: Stamp-duty exemption threshold raised from RM300 to RM3,000 monthly wages — effective 1 Jan 2026. Action: HR should template short-term/part-time contracts to benefit.
New initiatives (delivery, digital, and gov-tech)
- e-Invois nationwide in 2026; stamp-duty self-assessment; digital tax stamps by Customs (anti-counterfeit). Action: SMEs need accounting system upgrades, new SOPs, and staff training.
- MyDigital ID targets 15 million users by end-2025; Kiosk MADANI rollout across states; STAR team digitization drive cited as saving RM1.1b compliance costs. Action: Expect more services to require digital ID; plan consent and onboarding flows.
Potential pain points for citizens & SMEs (read: plan mitigations)
- Targeted fuel subsidies: while RON95 remains RM1.99/L for eligible users, ongoing database updates (e-hailing/boat owners) mean eligibility or quota administration can create friction. Mitigation: Verify status early; monitor appeals windows.
- Carbon tax pass-through: costs in steel/energy value chains could feed into construction, appliances, and power-intensive goods. Mitigation: Build indexation clauses and re-price frameworks.
- Langkawi/Labuan vehicle tax loophole closed: exemption capped to vehicles ≤ RM300,000 from 1 Jan 2026. Impact: premium vehicle buyers lose full exemption.
- Process & compliance load: e-Invois + stamp-duty self-assessment = new workflows for SMEs/micro-businesses; budget for systems and training.
What’s not a new burden (government’s stated stance)
The Government frames revenue gains as coming from governance (anti-leakage, enforcement) and subsidy retargeting “without adding burdens on the rakyat.” Use that as context when communicating price changes to customers or unions.
Practical checklists (so you can take action now)
For individuals
- Claimable in YA 2026: Keep receipts for local attraction/cultural admission fees (up to RM1,000).
- Sustainable living: If buying a food-waste shredder, keep documentation to rely on the broadened RM2,500 lifestyle relief.
- BUDI95: Confirm your eligibility; if you drive for e-hailing or are a registered boat owner, ensure your records are up-to-date.
For SMEs & corporates
- Tourism/MICE/Events (2026 only): Design promotions to meet incremental income tests; prepare audit trails.
- Green projects: Line up GTFS 5.0 applications and vendor lists; check guarantee tiers (80%/60%).
- E-invoicing: Map invoice sources and customers; select compliant software; plan user training and change-management. Start now.
- Stamp duty (employment contracts): For part-time/short-term hires under RM3,000/month, use standardized contract templates from 1 Jan 2026 to leverage the exemption.
- Carbon tax readiness: Identify facilities/products within iron/steel/energy chains; build emissions baselines and cost-pass-through playbooks.
Sector notes (selected)
- Semiconductors/high-value sectors: New and expanded funding (Khazanah/KWAP, BPMB) plus SemiconStart incubator are intended to ease prototyping and scale-up. Coordinate IP, grant and immigration strategies together.
- Halal: Financing + guarantees + Perak Halal Industrial Park = watch for vendor opportunities and early lot allocation.
Timeline & effective-date watchlist
- 1 Jan 2026 — Stamp-duty exemption for employment contracts up to RM3,000/month; vehicle-tax exemption cap in Langkawi/Labuan at RM300,000 vehicle value.
- 2026 — e-Invois nationwide; stamp-duty self-assessment; tourism/event tax incentives live for VM2026 year; carbon tax begins (initial sectors).
- By 31 Dec 2026 — GTFS 5.0 application window.
Caveats & compliance notes
- Many measures are framed as “Kerajaan bercadang…” or require subsidiary rules/guidelines. Expect implementing circulars, FAQs and application portals—check again before filing claims or pricing products.
- For tourism/MICE exemptions, record-keeping (contracts, invoices, audience/participant mix) will be critical to substantiate status as “international” and to calculate incremental income.
Bottom line
If you do nothing else this quarter: (1) stand up an e-Invois project, (2) audit your eligibility for the 2026 tourism incentives and individual reliefs, and (3) run a carbon-cost impact assessment for your supply chain. These three actions will capture upside and avoid avoidable compliance pain under Belanjawan MADANI 2026.