Rabat:Prime Minister Datuk Seri Anwar Ibrahim announced an increase in the individual income tax relief limit to RM12,000, up from the previous RM9,000, which had been in place since 2010.

According to BERNAMA News Agency, Anwar, who also serves as Finance Minister, revealed that the resident individual income tax rate was reduced by one percentage point. He stated that the scope of individual tax relief now includes medical treatment and postnatal care services.

Additionally, care for parents and grandparents will now cover all care expenses, not just medical health. The relief for sports equipment purchases now includes sports shoes, and course and skills training fees have been broadened to encompass all fields of study and children's tuition fees. Lifestyle relief has been expanded to cover AI subscriptions, vaccination costs, and pet adoptions from registered centers.

Anwar explained that these changes aim to address the concerns of the middle-income (M40) group, who have faced persistent cost-of-living pressures. He also announced a reduction in tax rates for certain income bands, with the rate for incomes between RM70,000 and RM100,000 reduced to 18 percent, and the rate for RM100,000 to RM150,000 cut to 24 percent.

The government is also adjusting the tax rate for high earners with incomes exceeding RM1 million to 30 percent. Anwar emphasized that these measures would provide up to RM1,600 in extra disposable income for around five million taxpayers.