Qualampur: Economists estimate that the budget 2026 will avoid starting major changes in the taxation system to maintain consumer and investor confidence amid the tariff implementation of the United States.
MBSB Investment Bank BHD research director and head Imran Yasin Yusoff suggested that the government may consider expanding the scope of capital profit tax to cover the profit from disposal of shares listed on Barsa Malaysia.
“Currently, the CGT has covered the profit from disposal of unrestaded shares and the disposal of foreign capital assets,” he said.
Imran said that any expansion would require another impact study and less likely to be introduced in the upcoming budget.
He identified other potential new taxes, including tobacco taxes such as hereditary taxes, sinners, or health tax.
Economist Doris Lews hoped that the budget chief will focus on increasing dividends and capital profit tax enforcement rather than introducing new levy.
“With a limited fiscal place for new taxes in 2026, the budget is likely to rely on incremental compliance reforms, such as e-invoicing and tax-identification numbers registration and taxing through the digitization of the administration and the tax widening the net through digitization of the administration,” said Liew.
He further said that the budget is likely to expand non-tax revenue through levy, fees and asset mudification.
Liew expressed that a carbon tax implementation, a recurring proposal, competition and regulator may withstand significant obstacles related to readiness.
He said, “In terms of readiness, Malaysia’s regulatory and monitoring structures are immature,” he said, any carbon tax will be launched as a pilot for listed companies.
Imran said that MBSB Research Bank Negara does not overcome any individual tax rate modifications, including those who earn income, after reducing the pre-Khali policy of Malaysia.
“In other words, we do not expect any major changes in the taxation system because high taxes may result in slow spending next year,” they explained.
LIEW said that corporate tax would definitely remain unchanged as Malaysia tries to maintain the trust of the investor after the recent business recession.
The trade of August 2025 decreased by 1.9% year-on RM247.07 billion, with export growth from 6.8% to 1.9% in July.
LIEW described the government’s challenge as ‘walking on a criterion between fiscal consolidation and development support’.
He said, “On the one hand, high revenue is required to shut down deficit and fund social expenses, on the other hand, the weakness of tariff-related exports, elevated food and energy costs and the global supply chain argue against new burden on uncertain firms or houses through 2027,” he said.
Imran insisted that it is positive to make the tax base comprehensive, it is equally important to increase tax compliance and curb theft.
Both economists do not estimate further expansion of sales and service tax coverage in the upcoming budget.
Prime Minister Datuk Seri Anwar Ibrahim is scheduled for the table of 2026 in Parliament on 10 October. – Bernma
