KUALA LUMPUR: Budget 2026 has ambitious national development plans, but it must be more transparent on spending to ensure credibility and public trust, says the Institute of Strategic Analysis and Policy Research (Insap).
The government did not elaborate on the sources of funding for the RM470bil Budget 2026, said the MCA think-tank.
“Without transparent disclosure, this Budget risks becoming a hidden transfer of burden from government accounts to the rakyat and public institutions.
“Fiscal expansion must be accompanied by transparent tax reform, institutional discipline and fairness in benefit distribution,” said Insap yesterday.
Insap also criticised the current Sales and Service Tax (SST), saying it is inefficient and that the e-invoicing measure under Budget 2026 increases compliance costs for business owners.
“Insap reiterates that a phased GST with exemptions for essentials would be a fairer and more transparent model,” it added.
Meanwhile, Insap commended Prime Minister Datuk Seri Anwar Ibrahim for announcing 1,500 new tertiary education places across 10 courses in the country’s top five research universities.
It said this is consistent with the call for expanded merit-based access to public universities.
Insap added, however, that the RM18.6bil allocation for higher education remains insufficient when universities already face shortfalls in operating expenses.
Insap said it supports the government’s decision to provide free education to 5,800 underprivileged students, but the institute said it is regrettable that the Budget omits a breakdown of allocations by school stream.
Insap said Budget 2026 expands subsidies and cash hand-outs to the people, but failed to address the issue with long-term reforms.
“While targeted social protection is necessary, affordability cannot rely on cash transfers alone.
“Real resilience must come from income growth, job creation and stable taxation,” it said.
Insap also noted that several major policies had been omitted completely, including the proposed Urban Renewal Act and the Rakan KKM programme.
Insap said there must be clarity on whether urban renewal would be state-funded, developer-financed or federally subsidised.
Insap said Budget 2026 also lacks a clear strategy for regional competitiveness in its announcement of allocations for Sabah and Sarawak. It said development in East Malaysia remains focused on hardware projects without a clear outlook.
“Insap reiterates that Sabah and Sarawak should be positioned as national food security hubs, with investment redirected toward agri-tech, logistics facilities and cooperative farming to ensure the region’s growth is productive, not just physical,” it said.
