Current Pricing Issues in Malaysia (2025)

1. Rising Cost of Living

Many Malaysians, especially those in the B40 income group, are struggling with higher prices for essentials like food, housing, and healthcare. Despite a reported inflation rate of 1.8% in 2024, the actual expenses for daily necessities remain a significant burden for low-income households. Business Today

2. Subsidy Reforms and Tax Adjustments

The government has implemented subsidy reforms and increased certain taxes to address fiscal challenges. For instance, the sales and services tax (SST) was raised from 6% to 8%, and subsidies for items like RON95 gasoline are being restructured. These changes can lead to higher prices for consumers. AP News+3AP News+3Free Malaysia Today+3

3. Supply Chain Disruptions

Global events and local challenges have caused disruptions in supply chains, leading to shortages and price increases for certain goods. For example, previous shortages of eggs and persistent high prices for chicken have been attributed to supply issues. The Star

4. Inflation in the Services Sector

While overall inflation has slowed, the services sector has experienced price increases. The Services Producer Price Index (SPPI) rose by 0.6% in the first quarter of 2025, indicating higher costs for services like transportation and hospitality. MENAFN

5. Regional Variations in Inflation

Inflation rates vary across different states in Malaysia. In 2024, states like Penang, Pahang, Sarawak, and Selangor recorded inflation rates higher than the national average of 1.8%, affecting the cost of living in these regions