Malaysia's Minister of Finance has issued the Income Tax (Global Trading Centre Incentive Scheme) Rules 2022, which were published on 4 March 2022 and considered effective from the year of assessment 2021. The scheme was first announced as part of the 2021 budget and provides for a 10% income tax rate for a period of 5 years that may be renewed for another 5 years. The scheme is available for qualifying companies that undertake qualifying activities in respect of strategic sourcing, procurement, and distribution of raw materials, components, and finished products to other companies within or outside Malaysia.
As specified in the rules, conditions for the scheme include that a qualifying company must:
The conditions for the scheme as formalized by the rules are in line with the guidelines issued by the Malaysian Investment Development Authority (MIDA) in September 2021. The rules apply for applications made through MIDA for the scheme on or after 1 January 2021 but not later than 31 December 2022.