Prime Minister Datuk Seri Anwar Ibrahim announced that a 2% tax will be imposed on annual dividends in excess of RM100,000 received from listed and private companies, starting in 2025.
This measure was initially proposed at a rate of 5%, lowered after protests from small and medium enterprises (SMEs).
Anwar assured that this tax will not burden SMEs, which often rely on dividends rather than salaries due to cash flow constraints.
He explained that only individuals with assets above RM2 million will be subject to this tax, with only an estimated amount of RM700 to RM800 per year to be paid from annual dividends of more than RM100,000 earned.
Several exemptions were also announced, including dividends from foreign sources, pioneer status companies, cooperatives, and entities in Labuan receiving existing tax exemptions.
Anwar, who is also the Minister of Finance, defended this move as an effort to increase national income without burdening the people.
This effort is a continuation of targeted subsidies for the benefit of 85% of the people, while the "poor" and foreigners will be charged the full market price for RON95.
