Malaysia 2026 Budget: Tax Exemption Extensions, New LLP Tax, Carbon Tax Introduction

Malaysia’s 2026 budget aims to enhance governance and broaden the tax base without introducing new taxes, striving for equitable taxation. To promote investment, it extends foreign-sourced income tax exemptions until 2030 and increases the stamp duty exemption threshold for lower wages. The budget introduces a new 2% tax on LLP partner profit distributions over RM100,000 and accelerates capital allowances for heavy machinery and ICT. Key measures include a flat 4% stamp duty for foreign property ownership, increased cigarette excise duties, and new tax reliefs for childcare, sustainability, and medical expenses, alongside environmental initiatives like a carbon tax for specific industries starting in 2026.

Source: kpmg.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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