Budget 2027 breezes through Dewan Rakyat after CSA signing

PARLIAMENT | The Dewan Rakyat has passed the Supply Bill 2027 at the policy stage by voice vote, following the government’s signing of a confidence and supply agreement (CSA) with 13 opposition and independent MPs.

Presiding over the session today, speaker Johari Abdul called for the vote on Budget 2027, after which he deemed that more voices supported the bill.

The next phase for the Supply Bill 2027 will be debates at the committee stage, which is expected to run from next week to Nov 26.

If the bill passes the committee stage, it will then go on to its third reading, after which it will be presented to the Dewan Negara. Upon the upper House’s approval, it will then be submitted for the Yang di-Pertuan Agong’s royal assent.

The budget’s passing today followed the government’s earlier signing of a CSA with six Bersatu MPs and six other former Bersatu lawmakers who previously declared their support for Prime Minister Anwar Ibrahim, and Muar MP Syed Saddiq Syed Abdul Rahman.

Under the CSA, the 13 MPs will receive constituency development funds equal to those of government backbenchers.

In return, the group will support Budget 2027 and Anwar’s administration until the end of the current parliamentary term.

Mas Ermieyati Samsudin (PN-Masjid Tanah) reportedly said suspended Bersatu MPs perceived to be aligned with opposition leader Hamzah Zainudin (PN-Larut) were neither invited nor informed of the signing ceremony in Parliament today. 

Hours after Anwar shared a video clip of the signing event on his social media platforms, Wawasan Negara also posted an image on Facebook depicting its president, Hamzah, alongside Deputy Prime Minister Ahmad Zahid Hamidi, who is also the BN chairperson.

This comes after BN and PN formally declared an alliance in the Malacca state election. The two coalitions also cooperated in the Negeri Sembilan and Johor state elections, to great success, despite BN’s alliance with Pakatan Harapan at the federal level.

In 2021, then prime minister Ismail Sabri Yaakob’s government signed a similar CSA with Harapan, pledging reforms and not to dissolve Parliament before July 31, 2022, in exchange for the coalition’s support for Budget 2022 and confidence motions.

Anwar, who is also the finance minister, unveiled Budget 2027 on Oct 9. The federal government’s proposed allocation for next year is RM459.8 billion, RM40.6 billion more than the last tabled budget under the current administration.

READ MORE: Eight takeaways from Budget 2027

More aid, tax relief

Besides allowances for youths, relief for National Higher Education Fund Corporation borrowers, and more assistance for Rahmah Cash Contribution recipients, the budget also includes increased tax relief and broader tax claims.

Speaking in the Dewan Rakyat today, Finance Minister II Amir Hamzah Azizan affirmed that Putrajaya will continue to implement the sales and service tax (SST), with the goods and services tax (GST) remaining out of its plans for now.

In his Budget 2027 winding-up speech for the Finance Ministry, Amir said the government intends to continue improving its SST system to reduce the impact of cascading taxes and compliance, noting that the SST provides room for a more progressive and targeted approach.

“The government can choose which goods and services to tax while exempting essential items. 

“Although some of the tax may be passed on through prices, the scope of taxation can be determined with the people’s affordability in mind,” Bernama quoted him as saying. 

Highlighting that SST collections account for three percent of gross domestic product, the same level recorded by the GST in 2017, Amir said replacing the SST with the GST would not necessarily generate additional revenue, but would instead shift the tax burden entirely from businesses to the rakyat.

Amir noted that while the government recognises GST’s advantages in collection efficiency, transparency, and the input tax credit mechanism, Putrajaya’s choice of tax system must take into account the people’s ability to pay.

Former economy minister Rafizi Ramli previously pushed for the reintroduction of GST, capped at five percent, arguing that the “important reform” is necessary to strengthen the nation’s finances.

The Bersama co-leader said this when presenting the party’s alternative budget two days before Anwar tabled Putrajaya’s version.

READ MORE: Bersama's Budget 2027: Not 'business as usual', and what it would do instead

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