8 takeaways for marketers from the Malaysia Budget 2025

Prime Minister Anwar Ibrahim on Friday unveiled the 2025 Budget with an allocation of RM421 billion - the largest in Malaysia's history. 

This is also the third MADANI budget tabled by Anwar since he became the nation's 10th prime minister. 

Themed "Reinvigorating the economy, driving reforms and prospering the rakyat", the 2025 budget strives to advance Malaysia's economic direction, correct course from systemic poverty and inequality and more for. 

Below, A+M lays out some of the key takeaways from the Budget 2025 that businesses and marketers should focus on. 

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1. RM40 billion in loans and financing 

As part of the 2025 budget, RM40 billion has been allocated as loan facilities and business financing guarantees under government agencies. 

Micro-sized loans amounting to RM3.2 billion will be available through TEKUN and BSN to assist small traders, the Chinese community and the Bumiputera. 

Bank Pembangunan Malaysia will provide RM6.4 billion in financing funds, among others, to support the financing of infrastructure development, digitalisation, tourism, logistics, transportation, renewable energy and the energy transition. 

Meanwhile, the government, through SJPP, will guarantee SME financing of up to RM20 billion, including a special RM5 billion guarantee for Bumiputera SMEs. 

A RM3.8 billion SME loan fund has also been provided by BNM to support entrepreneurs transitioning to digitalisation and automation, in addition to continuing to assist the agri-food sector and sustainable practices.

RM650 million will also be allocated to support women and youth who are hoping to venture into entrepreneurship.

To preserve the human capital, social, and welfare aspects of the Indian community, RM130 million has been specifically allocated to implement various programmes, including business financing for the Indian community.

2. Support for female entrepreneurs 

On top of the RM650 million allocation for women and youth venturing into entrepreneurship, a total of RM470 million has been allocated by SME Bank, BSN, Bank Rakyat, and MARA to support female PMKS entrepreneurs in obtaining working capital and financing for asset purchases, thereby enhancing their business capacity to greater heights.

3. Increased stamp duty effective 1 January 2025

The government proposed that the loan or financing limit under the 'Micro Financing Scheme' for stamp duty exemption purposes be increased from RM50,000 to RM100,000, effective from 1 January 2025

To expand MSMEs' access to alternative loans or financing, the government has also proposed full stamp duty exemption on loan or financing agreements executed by MSMEs with investors through the Initial Exchange Offering (IEO) platform from 1 January 2025 to 31 December 2026.

4. New RM100 million financing funds 

The government continues to support the business activities of cooperatives, including providing working capital. A financing fund of up to RM100 million is made available under the Malaysian Cooperative Commission. 

This will take place from 1 January 2025 to 31 December 2026. 

5.  New investment incentive framework 

PM Anwar said that the country must embark on a new paradigm shift to attract more meaningful investments.

"We can no longer sustain the outdated approach of offering incentives and support to investors without considering the broader economic benefits," said Anwar. 

As such, the government is introducing a new investment incentive framework. The framework will be focusing on increasing the level of economic complexity in the electrical and electronics sector, providing high-income jobs to Malaysians in the field of AI and research and development as well as to strengthen the local supply chain and primary sector ecosystem. 

The framework will also establish economic clusters in line with respective states' advantages such as renewable energy in Sabah and chemical industries in Pahang amongst others. 

Moreover, the framework will narrow the economic gap between Malaysian regions and encourage more investments that comply with environmental, sustainability and governance (ESG) standards. 

6. Tax on multinational companies

The government has also expressed its readiness to implement the global minimum tax (GMT) on multinational companies.

Although GMT will generate additional revenue, there remains a potential risk to the investment climate, said Anwar. To mitigate the impact of GMT, the government is committed to streamline existing incentives, introduce new non-tax incentives, and explore the feasibility of the 'strategic investment tax credit'

7. Enhance AI adoption 

Thus far, the country has secured investments totaling US$16.9 billion for the period up to 2038 from global technology giants such as Amazon Web Services (AWS), Microsoft, Google and Oracle.

As such, the National Artificial Intelligence Office (NAIO) has allocated nearly RM10 million to enhance efforts to increase the adoption of AI through collaborations with academia and industry. 

In a statement, PwC Malaysia tax leader Steve Chia said the Budget 2025 is "forward-thinking".

"I am hopeful that the government will provide sufficient time for businesses to get ready for this," added Chia. 

Photo courtesy Anwar Ibrahim, Facebook

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