Report: Chinese community has the biggest income gap


PETALING JAYA: Although Bumiputeras make up the most households in the bottom 40% (B40) category, the income gap between the rich and the poor is the biggest in the Chinese community, a report said today.

The Edge financial daily compared household income and expenditure data for the top 20% (T20) and B40 groups for Bumiputeras, Indians and Chinese in 2014 and 2016.

It found that the income gap remained unchanged among the Bumiputeras and narrowed among the Indians, but increased among the Chinese.

“For every RM1 the Bumiputeras in the B40 earned (in 2014), those in the T20 earned RM5.30. The gap remained the same in 2016.

“Among the Indians in the same period, the income gap narrowed from RM5.50 to RM5.20, and was the smallest among the ethnic groups,” it said.

But among the Chinese, the income gap rose from RM5.80 in 2014 to RM6 in 2016.

“This is the only ethnic group that experienced a widening of the income gap – the biggest compared with the others – between 2014 and 2016.”

The B40 category is defined as households with an income level of RM2,629 and below.

The Edge, quoting 2014 data from the Economic Planning Unit, said Bumiputera households account for 44.7% of the B40 group, followed by the Indians (38.71%) and the Chinese (28.02%).

In July, tax consultant Kang Beng Hoe told FMT that income disparity in Malaysia would only worsen unless the government reduced the income gap between the rich and the poor.

This was despite Prime Minister Najib Razak’s claim that Malaysia’s per capita income had risen since 2010, from RM28,000 to RM36,000 a year.

Referring to the Gini coefficient, a way to measure the income gap between the rich and poor, Kang said Malaysia’s Gini coefficient was among the highest in Asia.

In 2012, media reports said Malaysia was the 39th most unequal nation out of 159 nations, and third in Asia.