KUALA LUMPUR, Oct 18* — Prime Minister Datuk Seri Anwar Ibrahim will present his third federal budget today, with potential subsidy cuts and new taxes aimed at boosting development spending amid declining revenue, particularly from oil and gas. 

As federal revenue reaches its lowest point in five years, the government's challenge is to fund social assistance for low-income households while reducing the fiscal deficit. Analysts at BMI Research warn that revenue targets may be missed this year, despite increased sales taxes and a capital-gains tax.

Anwar has ruled out reintroducing the Goods and Services Tax (GST) until the minimum wage rises to between RM3,000 and RM4,000. Instead, recalibrating subsidies, particularly for RON95 petrol, could be on the table, with adjustments possibly starting by year-end.

Discussions also surround a high-value goods tax and a sugar-sweetened beverage tax to address health issues, following previous increases in SSB tax leading to reduced sugary drink consumption. Anwar has acknowledged the contentious proposal of an inheritance tax, which may deter investment.

Operating expenditures are expected to rise to RM306.5 billion in 2025, influenced by salary increases for civil servants, while development expenditure may grow to RM94.5 billion, with a focus on transport infrastructure projects like the Mass Rapid Transit 3 and the Kuala Lumpur-Singapore High-Speed Rail. The revision of the minimum wage, currently at RM1,500, is also anticipated soon.