The Master Builders Association Malaysia (MBAM) welcomes the announcement of Malaysia’s Budget 2026, which outlines substantial initiatives to help the rakyat. As the nation moves into the 13th Malaysia Plan (13MP), this budget plays a crucial role in providing critical infrastructure works while laying the groundwork for sustainable growth and infrastructure development with a development Budget of RM81 billion in 2026.
“MBAM commends the government’s proactive measures in Budget 2026, which prioritizes key infrastructure projects and underscores the critical role of the construction sector in driving Malaysia’s socio-economic development particularly in transportation and housing. However, we hope there will be more projects allocated for Peninsular Malaysia moving forward,” said Oliver HC Wee, President of MBAM
The industry continues to face significant challenges from volatile building material prices and a persistent cost of doing business increases. Compounding this is the new Sales and Service Tax (SST) on construction services, which places an undue burden on contractors locked into fixed-price contracts. Wee strongly appeals to the government to apply the SST only to contracts executed after January 1, 2026. This provides the industry with a crucial transition period and prevents disruption to ongoing projects, which is vital for maintaining project stability and managing cash flow.
To enhance productivity, the government should introduce grants and tax relief to lower the high upfront cost of adopting modern technologies like the Industrialised Building System (IBS) and Building Information Modelling (BIM). Incentivising green building materials will also align the sector with Malaysia’s sustainability goals.
A predictable project flow allows industry players to invest in capacity and skills with confidence. These measures will empower the construction sector to manage current challenges while building a more technologically advanced and resilient industry for Malaysia’s future.
Nevertheless, we look forward to continued collaboration with the government and stakeholders in transforming the budget and policies announced in Budget 2026 into tangible opportunities for the construction industry and the nation.
