Could a wealth tax fix Malaysia's inequality crisis?

Kua Kia Soong

There is a quiet imbalance at the heart of Malaysia’s economy – so stark that once seen clearly, it is impossible to justify.

According to the Forbes 2026 billionaires list, 15 Malaysian billionaires are among the world’s wealthiest. Their combined wealth is estimated at roughly RM260–270bn.

Expand the lens beyond the 15 billionaires, and the concentration only deepens. Forbes data puts the combined wealth of the 50 richest people in Malaysia at around US$90bn (close to RM400bn) – roughly equivalent to the federal government’s entire budgeted spending for 2026. That is private wealth on the scale of the Malaysian state itself.

Now consider the other side of the ledger. The bottom 50% of people in Malaysia – some 16–17 million people – collectively own a share of national wealth that, by most estimates, rivals what a tiny group of ultra-wealthy individuals control. This is not merely inequality. It is extreme concentration.

The hidden wealth above RM100m

But even this stark comparison understates the scale of the problem. Beyond the headline billionaires lies a broader class of the ultra-wealthy.

A rough estimate suggests that perhaps several hundred to a thousand people in Malaysia hold more than RM100m in wealth. Within this group, maybe a couple of hundred individuals possess more than RM500m each. Together, this elite probably controls several hundred billion ringgit in additional accumulated wealth, much of it concentrated in financial assets, property and corporate ownership.

This means the true concentration of wealth in Malaysia is not confined to a symbolic “top 50” or “top 100”. It extends to a narrow but powerful stratum of perhaps as few as 1,000 individuals in a country of 34 million.

A modest tax, a powerful impact

What would it take to begin correcting this imbalance? Not revolution. Not confiscation.

Consider two simple options.

Option 1: A 2% tax on the top 100 richest people in Malaysia. Assuming their combined wealth is roughly RM500bn [based on Forbes data for the top 50 and extrapolating], this would generate about RM10bn annually.

Option 2: A broader, graduated wealth tax — 1% on wealth above RM100m and 1.5% on wealth above RM500m. Using the rough estimates above, those with RM100–500m might contribute about RM1–2bn, and those above RM500m perhaps RM3–4bn. A conservative estimate puts the total at around RM5bn annually. With better enforcement and full asset disclosure, RM8–10bn is plausible.

Pause and consider that. A tax affecting less than 0.01% of the population could generate billions every year – without touching the income or consumption of ordinary people. This is not a theoretical exercise. This is real, usable fiscal space.

RM5–10bn is not small change. It could dramatically expand public healthcare capacity, fund scholarships, reduce the burden of higher education and strengthen social protection for the most vulnerable – all without drawing from wages, consumption or those already struggling with the rising cost of living.

Critics will say this is punitive, that it discourages success. But let us be honest about what is at stake. When 1,000 individuals command wealth approaching that of millions, and when 50 individuals alone hold wealth comparable to total annual federal government spending, the issue is not punishment. It is fair contribution.

The capital flight myth

We are told that if there is a wealth tax, the wealthy will simply leave. This risk is real – but not insurmountable.

Some countries have introduced exit levies to ensure that those who move their wealth abroad must first settle their obligations at home.

Malaysia can – and should – explore similar measures. An exit tax would help ensure that wealth created within Malaysia cannot simply vanish without contributing back to the society that made it possible.

Wealth taxes are not fantasies

Wealth taxes already exist.

Norway raises steady revenue from wealth taxation.

Spain has strengthened taxes on the ultra-rich after crises.

Switzerland derives a meaningful share of public revenue from wealth taxes.

These examples demonstrate a simple truth: the obstacle is not technical but political.

A wealth tax is not just about revenue. Extreme concentration of wealth translates directly into concentration of power – economic, political and social. Left unchecked, it distorts democracy itself. We know this reality well: money is the chief source of corruption.

A modest 1–2% tax will not dismantle inequality overnight. But it is a decisive step toward restoring balance between wealth and democracy.

The moment of choice

Malaysia does not suffer from a lack of wealth. It suffers from how that wealth is distributed.

Nearly RM400bn sits in the hands of just 15 individuals. Hundreds of billions more are held by a narrow elite of fewer than 1,000 people.

A modest, targeted wealth tax could yield RM5–10bn a year.

The question is no longer whether it is possible but whether there is the political courage to act. If not now – when?

Kua Kia Soong, a former MP, is the director of human rights group Suaram.

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