The Malaysian Investment Development Authority (MIDA) has recently introduced measures to exempt import tax and sales tax on machinery and equipment required for the manufacturing, hotel and land shipping industries. In addition, the tax exemption application implements an independent declaration mechanism, and the approval time is shortened from the previous 4 weeks to 2 weeks. Once approved once, it will be valid until 2017, and no bank guarantee is required.
The Investment Development Authority pointed out that eligible areas, namely manufacturing companies, companies involved in hotel business, and freight operators, can apply for exemption from import tax and sales tax through the independent declaration mechanism. Under this measure, applicants do not need a bank guarantee and can be exempted from paying bank guarantee interest and import and export detention fees, which can not only improve the operating efficiency of the enterprise, but also reduce its business costs.
MIDA CEO Azman Mah said that since the implementation of the self-declaration tax exemption mechanism on May 2, 2014, 280 companies have benefited from it. A total of 1,200 companies are currently applying for this discount, and it is expected that 5,000 companies will apply in the future. MIDA is also studying the extension of duty-free areas to the raw material industry.
