Incentive For ReinvestmentUnder New Industrial MasterPlan (NIMP) 2030
New Industrial Master Plan (NIMP) 2023 offers reinvestment incentive
with two tiers. Tier 1 providing Investment Tax Allowance (“ITA”) of
100% qualifying capital expenditure (“QCE”) against 100% of statutory
income and Tier 2 offering ITA of 60% QCE against 70% of statutory
income. This incentive is designed to encourage existing companies to
reinvest in high-growth and high-value activities.
Incentive For Reinvestment Under New Industrial Master Plan (NIMP) 2030
- Malaysian government has introduced a reinvestment incentive aligned with the New Industrial Master Plan (NIMP) 2030, featuring a tiered and outcome-driven framework.
- Objectives of the incentive are:
- To motivate companies to invest in sectors with high growth potential and substantial value.
- To ensure that the tax incentives provided by the Government support the achievement of the targeted outcomes under the NIMP 2030 and further stimulate national economic growth.
- This incentive provides an opportunity for existing companies that have exhausted their Reinvestment Allowance, to continue to increase their capacity and investment in high-growth and high-value areas in the country.
A. Type of Incentives
- The incentive is an Investment Tax Allowance (ITA) of 100% (or 60%) on the qualifying capital expenditure (excluding land cost) incurred for 5 years.
- The allowance can be offset against up to 100% (or 70%) of statutory income for each assessment year until fully utilized.
B. Eligible Applicant
- The company must be a Malaysian resident and incorporated in accordance with the Companies Act 2016.
- Undertake expansion or diversification projects in the manufacturing sector.
- The company eligible for only one (1) round of this reinvestment incentive.
C. Eligibility Criteria
List of product(s) or activity(ies) eligible for the reinvestment incentive as below:
- Aerospace
- Automotive
- Chemical including biotechnology
- Electrical & Electronics
- Food Processing
- Halal
- Machinery & Equipment
- Medical Devices
- Metal
- Mineral
- Palm Oil-based Products
- Pharmaceutical including biotechnology
- Petroleum Products and Petrochemicals
- Rail
- Rubber-based Products
- Ship building and Ship Repair
- Textile, Apparel and Footwear
- Wood, Paper and Furniture
The tiering tax incentive will be based on an outcome-based approach as follows:
Tier 1
Tier 2
Tax incentive
ITA of 100% on qualifying capital expenditure
(QCE) (excluding land) and set off against 100% of
statutory income.
ITA of 60% on QCE (excluding
land) and set off against 100% of statutory income.
Incentive period
5 years
Minimum Conditions
- QCE must be incurred within the proposed 3-year period capital expenditure (excluding land) to be realised within 3 years as proposed;
- Implementation of Industrial Revolution 4.0 (IR4.0) technologies is required; and
- R&D expenditures (included related to product and technology improvement) must align with the proposed plan.
Additional Conditions
Subject to the following outcomes (but not limited to):
- Adequate number of newly hired Malaysian full-time employees in high-value positions (with minimum basic salary RM 10,000/month);
- The number of local and/or local service providers (companies incorporated in Malaysia) engaged as proposed;
- Adoption of green technology (generation of renewable energy or utilisation of energy efficiency equipment); and
- Any additional requirements for sustained economic growth, as stated in the approval letter.
Not Applicable.
D. Date of Application
Applications received by Malaysia Investment Development Authority (“MIDA”) from 1 January 2024 until 31 December
2028 are eligible to be considered for this incentive.