Malaysia urged to broaden tax base to strengthen national development revenue

Traders Union
All News
Economic Data
Malaysia broadens tax base

Highlights

Datuk Seri Amirudin Shari urged the government to broaden the tax base and seek new strategic revenue sources to strengthen public finances.
Spending on subsidies, emoluments and debt limits economic reforms, requiring effective government revenue planning and more robust capacity to provide assistance.
Amirudin proposed that the government participate in strategic industries beyond PETRONAS to create new revenue streams that support development and reduce dependence on a single source.

This article was translated from the original. Read the original version by our correspondent here.

Proposals for new revenue in Supply Bill 2027

As reported by The Edge Malaysia, Gombak Member of Parliament Datuk Seri Amirudin Shari urged the government to broaden the tax base and identify new strategic revenue sources to strengthen public finances and create greater fiscal space for national development.

He said spending commitments on subsidies, emoluments, debt servicing and retirement benefits limit the government's ability to implement economic reforms and transformation programmes. According to him, stronger investment and trade must also translate into higher government revenue so that the public can continuously benefit from economic development.

While debating the Supply Bill 2027 at its second reading in the Dewan Rakyat on Wednesday, Amirudin, who is also the Selangor Menteri Besar, asked the Ministry of Finance to explain the measures taken to ensure economic growth genuinely increases government revenue and strengthens its capacity to provide assistance to the public.

Impact on fiscal policy and development

Amirudin said the effectiveness of the national development framework, including Ekonomi Madani and industrial development plans, should also be assessed based on its contribution to government revenue, in addition to economic growth, investment and trade.

He stressed that calls for greater public assistance must be considered alongside the government's ability to generate revenue through a more effective tax system. According to him, revenue generation requires careful planning to support the country's development, transformation and reforms while reducing reliance on funds from Petroliam Nasional Bhd, PETRONAS, and government-linked investment companies.

He also proposed selective government participation in strategic industries to create new revenue streams that can support national development and benefit the public. Amirudin described PETRONAS as a good example, but said the country needs another major project that does not depend on a single revenue source or sector alone.

In our previous coverage of fiscal warnings following Budget 2027, we highlighted the need for Malaysia to build stronger fiscal buffers as global financing costs remain volatile and spending commitments continue to rise. The article also outlined that limited fiscal space — with substantial operating expenditure — requires measures such as broadening the tax base and improving targeted subsidies to strengthen the country's financial resilience.

This material may contain third-party opinions, none of the data and information on this webpage constitutes investment advice according to our Disclaimer. While we adhere to strict Editorial Integrity, this post may contain references to products from our partners.