KUALA LUMPUR: The individual income tax rate for Malaysian residents will be reduced by two per cent for income bands of over RM35,000 to RM100,000 this year, Prime Minister Datuk Seri Anwar Ibrahim announced today.

The reduction is expected to provide around 2.4 million taxpayers with added disposable income of up to RM1,300, which will benefit the M40 group, he added.

“As I have explained, the government will take a progressive approach. While the M40 group will benefit from a reduced income tax rate, we will raise the tax rate for the high-income group by 0.5 to two per cent for tax bands of over RM100,000 to RM1 million.

“Only less than 150,000 taxpayers will be affected by the higher tax rate,” he said when presenting the Budget 2023 at the Dewan Rakyat today in his capacity as Finance Minister.

Anwar said through this approach, RM900 million in government tax income reduction will go on to benefit Malaysians, especially the M40 group.