Malaysia: National Budget 2020

The 2020 National Budget with the theme “Driving Growth and Equitable Outcomes Towards Shared Prosperity” was delivered on 11 October 2019 by our Minister of Finance, YB Lim Guan Eng. The Budget is based on four main thrusts: 

• Driving Economic Growth in the New Economy and Digital Era 

• Investing in Malaysians: Levelling Up Human Capital 

• Creating a United, Inclusive and Equitable Society 

• Revitalisation of Public Institutions and Finances 

Our Government is committed to bringing stability to the Government’s finances and achieving the goal of Vision 2020 with a new growth trajectory under foundation of “Shared Prosperity Vision 2030”. The 15 key strategies are: 

1. Making Malaysia the Preferred Destination for Investment 

2. Accelerating the Digital Economy 

3. Strengthening Access to Financing for Businesses 

4. Strengthening Economic Diversity 

5. Enhancing job opportunities for Malaysians

6. Modernising the Labour Market 

7. Investing in Education and Talent 

8. Inclusive Development – RM10.9 billion Allocated for rural development 

9. Towards Better Health Services 

10. Enhancing the Transportation Ecosystem 

11. Promoting Access to Housing 

12. Unity through Sports 

13. Promoting Environmental Sustainability 

14. Commitment to Fiscal Consolidation 

15. Strengthening Institutions: Governance & Integrity 

Some of the important announcement concerning taxation affecting companies are summarised below: 

• Corporate Income Tax Treatment for Small and Medium Enterprises (“SME”) 

It is proposed that: 

(a) the first chargeable income which is subject to the concessionary income tax rate of 17% be increased from RM500,000 to RM600,000; and 

(b) the above concessionary tax rate be given only to a company having gross business income for the relevant year of assessment of not more than RM50 million, in addition to the ordinary share capital requirement.

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