On 24th of February 2023, a newly revised Budget 2023, specifically for individual income tax rates, was announced by Prime Minister and Finance Minister Datuk Seri Anwar Ibrahim.
In dealing with high cost of living and to increase disposable income among middle-income Malaysians, the resident individual income tax rate is to be reduced by 2 percentage points (2%) for each chargeable income band between RM35,001 to RM100,000.
Essentially, this will effectively increase the disposable income of the M40 group (middle 40%) in Malaysia.
The income tax rate for the T20 Malaysians (top 20% of Malaysian household income) will be increased by 0.5% to 2% depending on income brackets, to make up for the reduction in the lower income groups.
For more details, you can head over to Malaysia' Ministry of Finance (MOF) website to understand more about the Budget 2023 Tax Measures.
How will this affect Potongan Cukai Bulanan (PCB/MTD) calculation in Talenox?
We have updated the new income tax rates in Talenox.
If you use our feature to export the LHDN's PCB report (under Month Total page) to cross-check the PCB amount, you may see a different result in the LHDN's PCB report, as LHDN hasn't updated their calculator with the new rates yet.
We have updated the system to include this disclaimer, in the event that you're seeing a different PCB figures.