The Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM) laud the 2026 Budget’s mildly expansionary stance, which focuses on strengthening resilient and inclusive growth, accelerating high-growth high-value investment, continued reforms and long-term sustainability development, aligning with the MADANI Economy Framework and 13th Malaysia Plan (2026-2030).
It is a responsive and growth-oriented Budget, easing cost of living pressure on households, supporting businesses and industries to navigate the global challenges. Key priorities and initiatives include expanding TVET and skills programs, enhancing high-value investment in semiconductors, green and blue economy as well as AI, accelerating technology adoption and R&D, supporting Domestic Direct Investment (DDI), especially micro, small and medium enterprises (MSMEs) and fostering regional development, including Johor-Singapore Special Economic Zone and the development of Special Tourism Investment Zones (STIZ) in Johor, Melaka, Negeri Sembilan and Sarawak.
The Government remains committed to its fiscal sustainability agenda, with the fiscal deficit to GDP ratio reducing further to 3.5% of GDP in 2026 Budget from estimated 3.8% in 2025. This marks the 5th consecutive year of progressive reduction since 2021 (6.4% of GDP).
ACCCIM President, Datuk Ng Yih Pyng is relieved that the Budget does not propose new taxes that would further burden MSMEs whose have already reeled from high operating costs and weak demand amid persistent global uncertainties.
The chamber is pleased that the Budget has accepted some of its proposals such as Market Development Grant (MDG), green energy, agriculture investment, property, as well as Accelerated Capital Allowance (ACA). While we welcome the proposed increases in MDG to RM60 million, it is proposed that special tax rate can be considered for SMEs that have shown significant incremental in their export growth. Following this higher allocation of MDG, we hope that MATRADE can consider to increase the lifetime cap of the MDG to RM500,000, while raising the per-claim ceiling to RM35,000 for international trade fairs and exhibitions, and RM10,000 for locally held trade fairs and exhibitions.
We are disappointed that the Budget did not give higher taxable income for SMEs enjoying a preferential income tax rate of 15% (currently, it is set at 15% on the first RM150,000 taxable income). Higher threshold of taxable income for a lower tax rate not only would ease SMEs’ financial burden but also provide more savings for undertaking business spending.
To boost the expansion of DDI, we view positively the Budget allocations for MSMEs amounting to RM50.0 billion (RM40.0 billion in 2025 Budget), covering soft loans, micro financing, and SJPP guarantee scheme.
While businesses appreciate these initiatives, a simplified application and evaluation as well as approval process is vital to enhance efficiency, reduce costs, and foster faster turnaround times, ensuring a quick disbursement of funds to eligible applicants. We propose to raise the amount of loan or financing in relation to a Micro Financing Scheme exempted from stamp duty higher up to RM100,000-200,000 from RM50,000.
ACCCIM is delighted that the Budget has allocated a sum of over RM700 million to boost the tourism industry, in conjunction with Visit Malaysia 2026. Among the measures include tax exemption for the renovation and refurbishment of premises, tour operators, companies/organizations/associations that organize conference and exhibitions.
Datuk Ng said that effective tourism policies are built on the coordination of various government levels and departments, working in tandem with private sector partners and local communities to achieve a sustainable and thriving tourism.
While the Budget proposes to raise the monthly wage threshold for stamp duty exemption on employment contracts to RM3,000 but it is lower than our proposal of RM10,000.
TVET gets another big allocation of RM7.9 billion in the Budget. While the budget is large, there are gaps in the quality of curriculum design and the way it’s delivered, including the quality of instructors and the development of soft skills. Inadequate specific funding for crucial areas like facility upgrades, modern equipment, and attracting qualified instructors remains a challenge.
