Tax the rich to protect the many

 When 100 individuals alone hold wealth comparable to national development spending, a wealth tax is not punishment – it is fair contribution.

From 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.

Today, about 19 Malaysian billionaires control roughly RM260-270 billion in wealth. Expand the lens slightly, and the top 50 richest individuals hold around RM420 billion.

But the real picture only becomes clear when we widen the frame further. The top 100 richest Malaysians are estimated to control nearly RM450-470 billion, close to half a trillion ringgit. That is wealth on the scale of the Malaysian state itself.

Now consider the other side of the ledger: the bottom 50% of Malaysians – some 16 to 17 million people – collectively own roughly the same or even less wealth than this tiny elite of 100 individuals. This is not merely inequality. It is extreme concentration.

The hidden wealth above RM100 million

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

An estimated 800 to 1,000 Malaysians hold more than RM100 million in wealth.

Within this group, roughly 120 to 200 individuals possess more than RM500 million each.

Together, these elites are estimated to control at least RM380-400 billion in additional 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 100”. It extends to a narrow but powerful stratum of perhaps just 1,000 individuals in a country of 34 million.

A modest tax, a powerful impact

Consider two simple options:

Option 1: A 2% tax on the top 100 richest Malaysians

Wealth base: RM470 billion

Revenue: RM9-9.5 billion annually.

Option 2: A broader, graduated wealth tax

1% on wealth above RM100 million

1.5% on wealth above RM500 million

This modest structure would generate:

RM1.6 billion from those with RM100-500 million

RM3.4 billion from those above RM500 million

A conservative estimate would put the figure at RM5 billion annually. With better enforcement and full asset disclosure, RM8-10 billion is entirely achievable.

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

The question of fairness

RM5 to RM10 billion is not small change. It could:

Dramatically expand public healthcare capacity.

Fund scholarships and reduce the burden of higher education.

Strengthen social protection for the most vulnerable.

And it would do so by drawing from accumulated wealth – not from wages, not from consumption, not from 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 can command wealth approaching that of millions, and when 100 individuals alone hold wealth comparable to national development 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 it is not insurmountable.

Countries such as the US, Germany, and France impose exit taxes, ensuring that those who move their wealth abroad must first settle their obligations in their countries.

Malaysia can – and should – do the same. An exit tax ensures 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. It is 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. - FMT

 Kua Kia Soong is a former MP and a former director of Suaram

The views expressed are those of the writer and do not necessarily reflect those of MMKtT.