A total of RM470 billion has been allocated under Budget 2026, compared to RM452 billion in 2025. Of this, RM338.2 billion, or 80.7 per cent, is for operational expenditure, while RM81 billion is set aside for development.
Among the highlights of Budget 2026, tabled by Prime Minister and Finance Minister Datuk Seri Anwar Ibrahim are:
- To strengthen the three branches of government, Parliament will receive RM220 million, with an additional RM5 million to empower the Special Select Committees of the Dewan Negara and Dewan Rakyat.
- Tax exemptions in Langkawi and Labuan will be limited to vehicles valued at not more than RM300,000. The new policy takes effect on Jan 1, 2026.
- RM700 million for enforcement agencies, including the police and Malaysian Anti-Corruption Commission, for asset procurement and training.
- Development funds for Sabah and Sarawak will increase to RM6.9 billion and RM6 billion, respectively.
- RM2.3 billion for airport upgrades in Penang, Sarawak, and Sabah, including the Penang, Kota Kinabalu, Tawau, and Miri airports, to be completed by 2028.
- Introduction of the Asean Business Entity (ABE) status in 2026 for public listed companies with businesses in member states, to enhance talent mobility and support regional development.
- RM50 billion in loans and guarantees for local entrepreneurs, including RM2.5 billion in microfinancing via Bank Simpanan Nasional and TEKUN Nasional.
- RM7.9 billion for technical and vocational education and training (TVET). The National TVET Council will receive RM45 million, including funds to integrate digital technology and artificial intelligence (AI) into education for 10,000 tahfiz and pondok students under the IPT@Community Programme.
- RM1.3 billion for TVET institutions under the education ministry to train 79,000 students.
- RM3 billion through HRD Corp to offer three million training opportunities in high-tech, digital, and energy transition sectors.
- RM2.4 billion to support Federal Land Development Authority (Felda), Rubber Industry Smallholders Development Authority (Risda), and Federal Land Consolidation and Rehabilitation Authority settlers and families, covering about 720,000 settlers.
- RM43 billion allocated to the Defence and Home ministries. The Defence Ministry receives RM21.7 billion, while the Home Ministry gets RM21.2 billion. RM6 billion will go towards maintaining and procuring defence assets, including air defence systems, two Multi-Role Support Ships, and 10 vehicles for Malaysian battalions.
- RM1 billion for the acquisition and maintenance of assets for the police and other uniformed agencies. Over RM1.5 billion for construction and upgrading of facilities for uniformed agencies nationwide.
- RM6 billion to support education opportunities for Bumiputera students via Majlis Amanah Rakyat (Mara), Yayasan Peneraju, and Universiti Teknologi Mara (UiTM).
- SME Bank to provide RM200 million in loans to Bumiputera small and medium enterprises to expand into export markets.
- RM2.4 billion allocated for Grade 1 to Grade 4 Bumiputera contractors.
- RM10 billion in government guarantees for Bumiputera entrepreneurs.
- 50 acres of land in Bandar Malaysia, Kuala Lumpur, will be converted to Malay reserve land to protect the Bumiputera economy. Petronas, the landowner, is preparing the development plan.
- RM250 million to revive the National Service Training Programme (PLKN) by 2027.
- RM412 million for Orang Asli development, including RM155 million to build and upgrade roads in Orang Asli villages.
- Malaysians aged 18 and above will receive RM100 Sumbangan Asas Rahmah (SARA) aid in February 2026. The aid, benefiting 22 million Malaysians, is part of a RM15 billion allocation supported by savings from targeted diesel and RON95 subsidies.
- Nine million Sumbangan Tunai Rahmah (STR) recipients will receive RM100 monthly next year, totalling RM1,200.
One million STR recipients under e-Kasih will receive RM200 monthly, amounting to RM2,400 a year. - RM46.5 billion for the Health Ministry. RM1.2 billion will go towards maintenance and repairs of hospitals and clinics, and RM100 million to upgrade district hospital wards. RM755 million will be used to replace outdated medical equipment and purchase new advanced tools.
- RM140 million to address overcrowding in public hospitals by outsourcing patient care and expanding facilities. RM30 million will strengthen health clinics and expand specialist services.
- RM60 million to develop an affordable basic health insurance product for Malaysians. The government will also broaden the RM3,000 income tax rebate for life insurance premiums to include coverage for children.
- RM66.2 billion for the Education Ministry. Nearly RM2 billion will be used to upgrade over 520 dilapidated schools, especially in Sabah and Sarawak, and to maintain facilities at all types of schools nationwide.
- The National Disaster Management Agency (Nadma) will receive RM460 million for disaster preparedness, including providing toilets with clean running water at temporary relief centres that can also be used by students.
- RM210 million for the Malaysian Communications and Multimedia Commission (MCMC) to develop early warning systems for disasters.
- Welfare allocation for senior citizens increased to RM1.26 billion, benefiting 180,000 elderly individuals through pocket money and activity centres.
- RM1 billion to procure new coaches for the Kelang Jaya LRT next year, and RM200 million to improve stage bus services, including new routes in Johor Bahru ahead of the Johor Bahru–Singapore Rapid Transit System (RTS) Link launch.
- Excise duties on cigarettes and alcoholic beverages will rise on Nov 1. Cigarette duties will increase by two sen per stick, and by RM40 per kg for cigars, cheroots, and cigarillos. Liquor duties will rise by 10 per cent.
- The National Higher Education Fund Corporation (PTPTN) will offer free higher education to 5,800 low-income students enrolled in public universities, involving an allocation of RM120 million.
- RM1.4 billion to assist people with disabilities, including allowances for those unable to work and support for disabled workers.
- RM5.9 billion for research, development, commercialisation, and innovation in artificial intelligence.
- RM2 billion to MCMC to build a sovereign AI cloud for Putrajaya.
- RM53 million in grants to promote the use of AI, blockchain, and quantum computing.
- RM2.62 billion in agricultural subsidies for 2026, covering paddy cultivation, fertiliser, seeds, and production incentives.
- The government will amend the Consumer Protection Act to introduce Lemon Law provisions to protect consumer rights against defective products and unfair practices.
- RM700 million to boost the tourism sector, including RM500 million for the Visit Malaysia Year 2026 campaign.
Malaysians will enjoy RM1,000 in tax rebates next year for entry fees to local tourist attractions and cultural programmes to encourage domestic tourism. - Over RM110 million for Madani Mobile Services to ensure rural and remote communities have direct access to government services.
