Kuala Lumpur:Rakuten Trade Sdn Bhd has identified the consumer sector as the primary beneficiary of Malaysia's Budget 2027 due to individual income tax relief designed to enhance spending power among middle-income Malaysians.

According to BERNAMA News Agency, Kenny Yee, Head of Research at Rakuten Trade, highlighted that the recalibration of personal income tax, beyond extended cash handouts and broader tax reliefs, could significantly boost spending power for middle-income households. He noted that these tax adjustments, awaited for over a decade, also offer a long-awaited positive impact for the market.

The government projects that the combined tax measures could provide up to five million taxpayers with an additional RM1,600 in disposable income. The budget includes an increase in the individual income tax relief limit from RM9,000 to RM12,000, and a one-percentage-point reduction in resident individual income tax rates for income bands between RM70,001-RM150,000.

Additionally, the minimum wage is set to rise from RM1,700 to RM2,000 starting June 2027, though micro, small, and medium enterprises (MSMEs) with annual sales below RM50 million will be exempt.

Beyond consumer spending, Rakuten Trade considers 2027 a "year of delivery" for the construction sector. Although no new major infrastructure projects were announced, the RM83 billion development expenditure allocation is expected to sustain ongoing projects, with Sabah and Sarawak receiving a combined RM34.9 billion.

In the property sector, incentives from the budget are anticipated to support mass-market demand, benefiting developers with appropriate exposure. One such incentive is the stamp duty exemption for eligible first-time homebuyers, offering full exemption for homes priced up to RM500,000, and a 50 percent exemption for homes priced between RM500,001 and RM750,000. These measures apply to eligible sale and purchase agreements executed between January 1, 2027, and December 31, 2030.