Small and medium enterprises (SMEs) are set to gain a major lift under Budget 2026, as the government unveils a comprehensive package of tax incentives, export assistance and targeted financing to drive digital transformation and global market expansion.
During the tabling of Budget 2026, Prime Minister Datuk Seri Anwar Ibrahim announced a 50% additional tax deduction for SMEs investing in artificial intelligence (AI) and cybersecurity training, a move designed to accelerate digital adoption and strengthen business resilience in a rapidly evolving economic landscape.
Anwar said the initiative reflects the government’s commitment to help local enterprises future-proof their operations and stay competitive in the digital economy.
“Digital capabilities are no longer optional for SMEs, they are essential for productivity, innovation and long-term sustainability,” he said.
Meanwhile, to strengthen Malaysia’s export ecosystem, Anwar said the government is allocating RM60 million under the MATRADE Market Development Grant to help micro-SMEs expand into both established and emerging markets, including Africa, Latin America and Central Asia.
“The funding will assist companies in areas such as market research, trade fair participation and product certification — vital enablers for Malaysian brands seeking to diversify beyond traditional markets.
“Complementing this, the SME Bank’s Regional Champions Programme will also channel RM200 million in loans to Bumiputera SMEs aspiring to enter or scale up in export markets,” he shared.
Separately, Anwar also revealed that women-led enterprises will also receive a dedicated boost, with RM270 million in financing made available through Bank Rakyat, Bank Simpanan Nasional, MARA and SME Bank.
“The funds will support women MSME entrepreneurs in expanding operations, adopting new technologies and tapping new market opportunities,” he said, emphasising that this targeted funding underscores the government’s emphasis on inclusive entrepreneurship, ensuring women-owned businesses have equitable access to growth capital and financial resources.
To improve ease of doing business, Anwar confirmed that the e-invoice initiative will be implemented comprehensively from 2026, enhancing transparency and simplifying documentation for SMEs. In parallel, a stamp duty self-assessment system will be introduced to foster greater tax compliance and administrative efficiency.
