KUALA LUMPUR: The reduction in personal income tax rate announced in the Budget 2023 is part of the government’s efforts in helping the middle-income individuals (M40) deal with the rising cost of living, Chartered Tax Institute Malaysia (CTIM) president Chow Chee Yen said.
“A reduction in personal income tax rate does not happen often. It comes as a welcomed surprise that the personal income tax rate will be reduced by two per cent for individuals earning chargeable income between RM50,001 to RM100,000 (effective 2023).
“This is part of the government’s efforts in helping middle-income individuals deal with the rising cost of living and increase their disposable income by up to RM1,000,” he said in a statement in response to the Budget 2023 tabled by the Minister of Finance Tengku Datuk Seri Zafrul Abdul Aziz at the Parliament yesterday.
Meanwhile, Chow said the move to reduce income tax rate for micro, small and medium enterprises (MSMEs) to 15 per cent from 17 per cent for the first RM100,000 taxable income, effective from the year of assessment of 2023, is a continuation of the government’s practice in supporting MSMEs in recent budgets and recognising their contribution to the economy.
“This measure is set to benefit 150,000 MSME taxpayers in tax savings of up to RM2,000 each, which will help them during this post-Covid-19 recovery period,” he said.
Overall, Chow said the Budget 2023 is an expansionary budget and a pro-investment, pro-development, pro-education, pro-environment, pro-empowerment and most importantly, a pro-people budget.
“This budget prioritises reinforcing the momentum of the current economic recovery and it is expected to continue the country’s ongoing recovery momentum in addition to placing emphasis on structural reforms and strengthening economic resilience,” he added.-Bernama
