KUALA LUMPUR (Oct 29): The Dewan Rakyat passed the Supply Bill 2027, or Budget 2027, at the policy stage on Thursday after it received majority support from Members of Parliament in a voice vote.

The vote was held after Finance Minister II Datuk Seri Amir Hamzah Azizan concluded his winding-up speech on the bill. Speaker Tan Sri Johari Abdul subsequently announced that the bill had been passed.

The bill will now proceed to the committee stage for detailed debate, scheduled to begin on Nov 2 and run until Nov 26. If approved, it will undergo a third reading before being presented to the Dewan Negara. Once passed by the upper house, it will be submitted to the Yang di-Pertuan Agong for royal assent.

Prime Minister Datuk Seri Anwar Ibrahim tabled Budget 2027 on Oct 9, his fifth budget since the formation of the unity government in 2022.

With the theme “Reaching for the Skies, While Anchored on Our Values”, the budget provides for total federal expenditure of RM459.8 billion, comprising RM376.8 billion in operating expenditure and RM83 billion in development expenditure.

Separately, government-linked investment companies are expected to invest RM25 billion, while public-private investments are projected at RM11 billion. Federal statutory bodies and companies owned by Minister of Finance Incorporated are expected to invest a further RM14.2 billion.

Federal revenue for 2027 is projected at RM380.8 billion, with PETRONAS dividends expected to contribute RM32 billion.

The government aims to narrow the fiscal deficit to 3.3% of gross domestic product in 2027, from a target of 3.6% for 2026.

Among the key measures announced in the budget is an increase in the minimum wage to RM2,000 a month from RM1,700, effective June 2027. Micro, small and medium enterprises with annual sales below RM50 million will be exempted from the new rate.

The government will also introduce a minimum monthly salary of RM2,500 for semi-skilled workers and graduates as an initial step towards reforming the wage framework.

To provide relief to middle-income earners, the government will raise the individual income tax relief limit from RM9,000 to RM12,000, the first revision since 2010.

Resident individual income tax rates will also be reduced by one percentage point, with the rate for chargeable income between RM70,001 and RM100,000 lowered to 18%, and that for income between RM100,001 and RM150,000 reduced to 24%.

The higher tax relief limit and lower tax rates are expected to provide additional disposable income of up to RM1,600 to about five million taxpayers.

However, the tax rate for individuals with income exceeding RM1 million will be raised to 30% as part of efforts to broaden the government’s tax base.

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