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Incentives for Strategic Projects

Government Incentives

Incentives for Strategic Projects

Strategic projects involve products or activities of national importance. They generally involve heavy capital investments with long gestation periods, have high levels of technology, are integrated, generate extensive linkages and have significant impact on the economy.

Such projects qualify for:

1 Pioneer Status with income tax exemption of 100% of statutory income for a period of 10 years. Unabsorbed capital allowances as well as accumulated losses incurred during the pioneer period can be carried forward and deducted from the post pioneer income of the company; or
2 Investment Tax Allowance of 100% on the qualifying capital expenditure incurred within 5 years from the date the first qualifying capital expenditure is incurred. The allowance can be utilised to offset against 100% of the statutory income for each year of assessment. Any unutilised allowances can be carried forward to subsequent years until fully utilised.

Applications for this incentive should be submitted to the Malaysian Investment Development Authority (MIDA).

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