KUALA LUMPUR, Oct 9 — The government will increase individual income tax relief from RM9,000 to RM12,000 and reduce tax rates for selected income brackets under Budget 2027.

Prime Minister Datuk Seri Anwar Ibrahim said the measures were aimed at easing the cost-of-living burden on middle-income earners.

The increase would mark the first revision to the individual tax relief limit since 2010.

“The government hears the concerns of the middle-income group (M40), who have patiently persevered despite also being squeezed by the cost of living,” Anwar said when tabling Budget 2027 in Parliament today.

Under the revised tax rates, the rate for individuals with taxable income between RM70,000 and RM100,000 will be reduced to 18 per cent, while those in the RM100,000 to RM150,000 bracket will see their rate lowered to 24 per cent.

Anwar also announced expanded tax reliefs covering a wider range of expenses.

Medical tax relief will be extended to include postpartum care services, while relief for the care of parents and grandparents will cover all care-related expenses rather than being limited to healthcare costs.

Sports equipment relief will be expanded to include sports shoes, while education and skills training relief will cover all fields of study as well as children’s tuition fees.

Lifestyle tax relief will also be expanded to include artificial intelligence (AI) subscriptions, vaccination costs and the adoption of pets from registered centres.

Anwar said the government would also adopt a progressive approach by setting the income tax rate at 30 per cent for individuals earning more than RM1 million.