PERINTAH CUKAI PENDAPATAN (PENGECUALIAN) (NO. 2) 2023

“aktiviti menjana pendapatan teras” ertinya aktiviti yang dijalankan oleh suatu hab prinsipal berhubung dengan perkhidmatan yang layak atau aktiviti perdagangan yang layak;

“aktiviti perdagangan yang layak” ertinya aktiviti yang dijalankan oleh suatu hab prinsipal berkenaan dengan pemerolehan dan penjualan bahan mentah, komponen dan barangan siap daripada hab prinsipal itu kepada suatu syarikat rangkaian di dalam atau di luar Malaysia;

“hab prinsipal" ertinya suatu hab prinsipal sebagaimana yang diperuntukkan di bawah perenggan 3;

“Lembaga Pembangunan Pelaburan Malaysia” ertinya Lembaga Pembangunan

Pelaburan Malaysia yang ditubuhkan di bawah Akta Lembaga Pembangunan Pelaburan

Malaysia (Pemerbadanan) 1965 [Akta 397];

“perkhidmatan yang layak”

ertinya perkhidmatan yang dinyatakan dalam Jadual 1;

P.U. (A) 251 3

"syarikat berkaitan" mempunyai erti yang sama yang diberikan kepadanya dalam subseksyen 2(1) Akta Penggalakan Pelaburan 1986 [Akta 327];

“syarikat rangkaian” ertinya—

Jadual 1 kepada Akta dikurangkan oleh amaun cukai yang dikenakan ke atas pendapatan yang boleh dikenakan cukai daripada aktiviti perdagangan yang layak itu pada kadar sepuluh peratus;

P.U. (A) 251 7

B ialah amaun cukai yang dikenakan ke atas pendapatan yang boleh dikenakan cukai hab prinsipal daripada aktiviti perdagangan yang layak pada kadar cukai semasa sebagaimana yang diperuntukkan dalam perenggan 2

Bahagian

I

Jadual 1 kepada Akta; dan

C ialah amaun pendapatan yang boleh dikenakan cukai hab prinsipal daripada aktiviti perdagangan yang layak.

(6)

Pendapatan berkanun yang disebut dalam subperenggan

(1)

dalam tempoh asas bagi setiap tahun taksiran hendaklah ditentukan selepas memotong elaun yang kena dibuat di bawah Jadual 3 kepada Akta walaupun tiada tuntutan bagi elaun itu telah dibuat.

(7)

Tiada apa-apa jua dalam subperenggan (1) boleh melepaskan atau disifatkan telah melepaskan hab prinsipal itu daripada mematuhi apa-apa kehendak untuk mengemukakan apa-apa penyata atau penyata akaun, atau memberikan apa-apa maklumat lain, di bawah Akta.

Pendapatan harta intelek tidak diambil kira 5.

(1)

Dalam menentukan pendapatan berkanun suatu hab prinsipal yang disebut dalam subperenggan 4(1), pendapatan harta intelek yang berikut yang diperoleh daripada aktiviti menjana pendapatan teras hab prinsipal hendaklah tidak diambil kira:

(a)

royalti dan pendapatan lain yang diperoleh pada atau selepas 1 Julai 2018 tetapi sebelum 1 Julai 2021 daripada hak harta intelek yang baharu yang dimiliki oleh hab prinsipal; dan

P.U. (A) 251 8

(b)

royalti dan pendapatan lain yang diperoleh pada atau selepas 1 Julai 2021 daripada semua hak harta intelek yang dimiliki oleh hab prinsipal.

(2)

Bagi maksud subperenggan (1)—

(a)

suatu hab prinsipal memiliki hak harta intelek jika hab prinsipal itu adalah pemilik atau pemegang lesen hak itu; dan

(b)

royalti dan pendapatan lain yang diperoleh daripada hak harta intelek jika ia boleh diterima sebagai balasan bagi pengeksploitasian secara komersial hak itu.

(3)

Apa-apa pendapatan harta intelek yang disebut dalam subperenggan (1)

adalah tertakluk kepada cukai di bawah Akta.

(4)

Dalam perenggan ini—

“hak harta intelek”

ertinya suatu hak yang timbul daripada mana-mana paten, penemuan dan inovasi utiliti, hak cipta, cap dagangan dan cap perkhidmatan, reka bentuk industri, reka bentuk susun atur litar bersepadu, kepandaian dan proses atau formula rahsia, petunjuk geografi dan pemberian geran perlindungan varieti tumbuhan, dan hak-hak lain yang serupa, sama ada yang berdaftar atau boleh daftar;

“hak harta intelek yang baharu”

ertinya hak harta intelek berhubung dengan aktiviti menjana pendapatan teras hab prinsipal yang menjadi milik hab prinsipal—

(a)

pada atau selepas 1 Julai 2018; atau

P.U. (A) 251 9

(b)

selepas 16 Oktober 2017 tetapi sebelum 1 Julai 2018 akibat perolehan oleh hab prinsipal, secara langsung atau tidak langsung, daripada syarikat berkaitan.

Layanan cukai bagi hab prinsipal yang mengalami kerugian

6. (1)

Jika suatu hab prinsipal didapati mempunyai kerugian larasan di bawah subseksyen 44(2) Akta bagi tempoh asas bagi suatu tahun taksiran semasa tahun taksiran yang dikecualikan berkenaan dengan sumber perniagaan yang terdiri daripada perkhidmatan yang layak atau aktiviti perdagangan yang layak, amaun kerugian larasan itu tidak boleh diambil kira daripada sumber yang terdiri daripada perkhidmatan yang layak atau aktiviti perdagangan yang layak itu dan perniagaan lain.

(2)

Jika suatu hab prinsipal didapati mempunyai kerugian larasan di bawah subseksyen 43(2) Akta bagi tempoh asas bagi suatu tahun taksiran semasa tahun taksiran yang dikecualikan berkenaan dengan sumber perniagaan yang terdiri daripada perkhidmatan yang layak atau aktiviti perdagangan yang layak, amaun kerugian larasan itu tidak boleh diambil kira daripada sumber yang terdiri daripada perkhidmatan yang layak atau aktiviti perdagangan yang layak itu dan perniagaan lain.

(3)

Apa-apa amaun kerugian larasan yang ditentukan menurut subseksyen 43(2) dan 44(2) Akta berkenaan dengan sumber perniagaan yang terdiri daripada perkhidmatan yang layak atau aktiviti perdagangan yang layak tidak boleh diambil kira bagi maksud Akta dalam tahun taksiran yang tarikh akhir tahun taksiran yang dikecualikan hab prinsipal itu jatuh dan dalam tahun taksiran yang berikutnya selepas tahun taksiran yang dikecualikan itu, mengikut mana-mana yang berkenaan.

Penarikan balik pengecualian 7.

(1)

Menteri boleh menarik balik pengecualian yang diberikan di bawah subperenggan 4(1) sekiranya dalam mana-mana tahun taksiran daripada tahun taksiran yang dikecualikan, hab prinsipal gagal untuk mematuhi apa-apa syarat yang dikenakan berhubung dengan pengecualian.

P.U. (A) 251 10

(2)

Jika pengecualian ditarik balik mengikut subperenggan

(3)

Walau apa pun subperenggan (1) dan (2), jika dalam mana-mana tahun taksiran daripada tahun taksiran yang dikecualikan, hab prinsipal gagal untuk mematuhi apa-apa syarat yang dikenakan berhubung dengan pengecualian, perenggan 4

tidak terpakai.

Penyerahan pengecualian 8.

(1)

Menteri boleh, pada bila-bila masa, kecuali jika hab prinsipal gagal mematuhi apa-apa syarat yang dikenakan berhubung dengan pengecualian, membenarkan hab prinsipal untuk menyerahkan pengecualian yang diberikan di bawah Perintah ini melalui notis secara bertulis kepada Menteri melalui

Lembaga Pembangunan Pelaburan Malaysia.

(2)

Penyerahan pengecualian itu hendaklah berkuat kuasa mulai tahun taksiran yang permohonan bagi penyerahan pengecualian itu diterima oleh

Menteri melalui Lembaga Pembangunan Pelaburan Malaysia dengan syarat bahawa semua syarat bagi kategori hab prinsipal yang berkaitan yang dinyatakan dalam

Jadual 2 atau Jadual 3 dipatuhi.

Punca berasingan dan akaun berasingan 9.

(1)

Jika hab prinsipal menjalankan perkhidmatan yang layak, aktiviti perdagangan yang layak atau aktiviti selain aktiviti menjana pendapatan teras, setiap aktiviti hendaklah dikira sebagai suatu punca aktiviti berasingan dan berlainan bagi hab prinsipal itu.

(2)

Hab prinsipal yang diberikan pengecualian di bawah subperenggan 4(1)

hendaklah menyenggara suatu akaun yang berasingan bagi pendapatan yang diperoleh daripada setiap aktiviti yang disebut dalam subperenggan (1).

P.U. (A) 251 11

Ketidakpakaian 10.

Perintah ini tidak terpakai bagi hab prinsipal yang dalam tahun taksiran yang dikecualikan—

(a)

telah membuat suatu tuntutan bagi elaun pelaburan semula di bawah

Jadual 7A kepada Akta atau elaun pelaburan bagi sektor perkhidmatan di bawah Jadual 7B kepada Akta;

(b)

telah diberikan apa-apa insentif di bawah

Akta

Penggalakan

Pelaburan 1986;

(c)

telah diberikan pengecualian di bawah perenggan 127(3)(b) atau subseksyen 127(3A) Akta; atau

(d)

telah membuat suatu tuntutan bagi potongan di bawah mana-mana kaedah-kaedah yang dibuat di bawah seksyen 154 Akta kecuali—

(i)

kaedah-kaedah berhubung dengan elaun di bawah Jadual 3

kepada Akta;

(ii)

Kaedah-Kaedah Cukai Pendapatan (Potongan bagi Perbelanjaan

Audit) 2006 [P.U. (A) 129/2006];

(iii)

Kaedah-Kaedah Cukai Pendapatan (Potongan bagi Perbelanjaan berhubung dengan Yuran Kesetiausahaan dan Yuran Pemfailan

Cukai) 2014 [P.U. (A) 336/2014]; atau

(iv)

Kaedah-Kaedah Cukai Pendapatan (Potongan bagi Perbelanjaan berhubung dengan Yuran Kesetiausahaan dan Yuran Pemfailan

Cukai) 2020 [P.U. (A) 162/2020].

P.U. (A) 251 12

JADUAL 1

[Perenggan 2]

(1)

Bil.

(2)

Kluster

(3)

Perkhidmatan yang layak

1.

Perkhidmatan strategik

(f)

Pemerolehan dan pengurusan bakat peringkat senior

2.

Perkhidmatan perniagaan

(f)

Pembangunan perniagaan

P.U. (A) 251 13

(1)

Bil.

(2)

Kluster

(3)

Perkhidmatan yang layak

(i)

Analisis kajian ekonomi atau pelaburan

(j)

Sumber, pemerolehan dan pengagihan strategik

3.

Perkhidmatan kongsi

P.U. (A) 251 14

JADUAL 2

[Perenggan 4 dan 8]

Bil.

Syarat bagi hab prinsipal yang tidak mempunyai status suatu ibu pejabat operasi, suatu pusat perolehan antarabangsa atau suatu pusat pengedaran serantau yang menjalankan aktiviti menjana pendapatan teras

1.

Bilangan minimum pekerja baharu sepenuh masa di Malaysia dengan gaji minimum sebanyak lima ribu ringgit sebulan dan sekurang-kurangnya lima puluh peratus daripada pekerja baharu itu ialah warganegara

Malaysia

2.

Bilangan minimum pekerja baharu sepenuh masa di Malaysia dengan gaji minimum sebanyak dua puluh lima ribu ringgit sebulan

5 orang 3.

Amaun minimum perbelanjaan operasi tahunan di

Malaysia

(dalam Ringgit Malaysia)

(a)

RM10,000,000.00; atau

(b)

purata perbelanjaan operasi bagi tiga tahun taksiran sebaik sebelum tahun taksiran yang dikecualikan tambah tiga puluh peratus, mengikut mana-mana yang lebih tinggi

P.U. (A) 251 15 4.

Bilangan minimum perkhidmatan yang layak

4 (termasuk dua perkhidmatan yang layak daripada butiran (a)

dan (b) kluster 1 Jadual 1)

5.

Amaun minimum nilai jualan tahunan

(dalam Ringgit Malaysia)

(syarat tambahan bagi hab prinsipal yang menjalankan aktiviti perdagangan yang layak)

(a)

RM500,000,000.00; atau

(b)

purata nilai jualan tahunan bagi tiga tahun taksiran sebaik sebelum tahun taksiran yang dikecualikan, mengikut mana-mana yang lebih tinggi

JADUAL 3

[Perenggan 4 dan 8]

Bil.

Syarat bagi hab prinsipal yang telah diluluskan oleh Menteri sebagai status suatu ibu pejabat operasi, suatu pusat perolehan antarabangsa atau suatu pusat pengedaran serantau dan telah diluluskan insentif bagi ibu pejabat operasi, pusat perolehan antarabangsa atau pusat pengedaran serantau yang menjalankan aktiviti menjana pendapatan teras

1.

Bilangan minimum pekerja baharu sepenuh masa di Malaysia dengan gaji minimum sebanyak lima ribu ringgit sebulan dan sekurang-kurangnya lima puluh peratus daripada pekerja baharu itu ialah warganegara Malaysia

(a)

60 orang; atau

(b)

pekerja sepenuh masa sedia ada tambah dua puluh peratus, mengikut mana-mana yang lebih tinggi

P.U. (A) 251 16 2.

Bilangan minimum pekerja baharu sepenuh masa di

Malaysia dengan gaji minimum sebanyak dua puluh lima ribu ringgit sebulan

5 orang 3.

Amaun minimum perbelanjaan operasi tahunan di

Malaysia

(dalam Ringgit Malaysia)

(a)

RM13,000,000.00; atau

(b)

purata perbelanjaan operasi bagi tiga tahun taksiran sebaik sebelum tahun taksiran yang dikecualikan tambah dua puluh peratus, mengikut mana-mana yang lebih tinggi

4.

Bilangan minimum perkhidmatan yang layak

4 (termasuk dua perkhidmatan yang layak daripada butiran (a)

dan (b) kluster 1 Jadual 1)

5.

Amaun minimum nilai jualan tahunan

(dalam Ringgit Malaysia)

(syarat tambahan bagi hab prinsipal yang menjalankan aktiviti perdagangan yang layak)

(a)

RM500,000,000.00; atau

(b)

purata nilai jualan tahunan bagi tiga tahun taksiran sebaik sebelum tahun taksiran yang dikecualikan, mengikut mana-mana yang lebih tinggi

P.U. (A) 251 17

Bil.

Syarat bagi hab prinsipal yang telah diluluskan oleh Menteri sebagai status suatu ibu pejabat operasi, suatu pusat perolehan antarabangsa atau suatu pusat pengedaran serantau dan tidak diluluskan insentif bagi ibu pejabat operasi, pusat perolehan antarabangsa atau pusat pengedaran serantau yang menjalankan aktiviti menjana pendapatan teras

1.

Bilangan minimum pekerja baharu sepenuh masa di

Malaysia dengan gaji minimum sebanyak lima ribu ringgit sebulan dan sekurang-kurangnya lima puluh peratus daripada pekerja baharu itu ialah warganegara Malaysia

Pekerja sepenuh masa sedia ada tambah tiga puluh peratus 2.

Bilangan minimum pekerja baharu sepenuh masa di Malaysia dengan gaji minimum sebanyak dua puluh lima ribu ringgit sebulan

5 orang 3.

Amaun minimum perbelanjaan operasi tahunan di

Malaysia

(dalam Ringgit Malaysia)

(a)

RM10,000,000.00; atau

(b)

purata perbelanjaan operasi bagi tiga tahun taksiran sebaik sebelum tahun taksiran yang dikecualikan tambah tiga puluh peratus, mengikut mana-mana yang lebih tinggi

P.U. (A) 251 18 4.

Bilangan minimum perkhidmatan yang layak

4 (termasuk dua perkhidmatan yang layak daripada butiran (a)

dan (b) kluster 1 Jadual 1)

5.

Amaun minimum nilai jualan tahunan

(dalam Ringgit Malaysia)

(syarat tambahan bagi hab prinsipal yang menjalankan aktiviti perdagangan yang layak)

(a)

RM500,000,000.00; atau

(b)

purata nilai jualan tahunan bagi tiga tahun taksiran sebaik sebelum tahun taksiran yang dikecualikan, mengikut mana-mana yang lebih tinggi

Dibuat 18 Ogos 2023

[Perb.:MOF.TAX(S)700-2/1/202; LHDN.AY.A600-12/1/7(29)-303; PN(PU2)80/JLD.109]

ANWAR BIN IBRAHIM

Menteri Kewangan

[Akan dibentangkan di

Dewan

Rakyat menurut subseksyen 127(4)

Akta Cukai Pendapatan 1967]

P.U. (A) 251 19

INCOME TAX ACT 1967

INCOME TAX (EXEMPTION) (NO. 2) ORDER 2023

IN exercise of the powers conferred by paragraph 127(3)(b)

of the Income Tax Act 1967 [Act 53], the Minister makes the following order:

Citation and commencement 1.

(1)

This order may be cited as the Income Tax (Exemption) (No. 2)

Order 2023.

(2)

This Order is deemed to have effect from the year of assessment 2019.

Interpretation 2.

In this Order—

“core income generating activities” means activities undertaken by a principal hub in relation to the qualifying services or qualifying trading activities;

“qualifying trading activities” means activities undertaken by a principal hub in respect of procurement and sale of raw materials, components and finished products from the principal hub to a network company within or outside Malaysia;

“principal hub" means a principal hub as provided under paragraph 3;

“Malaysian Investment Development Authority” means the Malaysian Investment

Development Authority established under the Malaysian Investment Development

Authority (Incorporation) Act 1965 [Act 397];

“qualifying services” means services specified in Schedule 1;

“related company” has the same meaning assigned to it in subsection 2(1)

of the Promotion of Investments Act 1986 [Act 327];

P.U. (A) 251 20

“network company” means—

(a)

a related company;

(b)

an entity within the same group of company of the principal hub including a subsidiary, branch, joint venture or franchise; or

(c)

a company which has a contractual agreement with the principal hub or the principal hub’s ultimate holding company which relates to the principal hub’s supply chain and business for at least three years.

Principal hub 3.

A principal hub referred to under this Order is a company which—

(a)

is incorporated under the Companies Act 2016 [Act 777] and resident in Malaysia;

(b)

is already operating in Malaysia which—

(i)

does not have an operational headquarters, international procurement centre or regional distribution centre status; or

(ii)

has been approved by the Minister as having an operational headquarters, international procurement centre or regional distribution centre status; and—

(A)

has been approved incentive for operational headquarters, international procurement centre or regional distribution centre; or

(B)

has not been approved incentive for operational headquarters, international procurement centre or regional distribution centre; and

P.U. (A) 251 21

(c)

has a paid-up capital of more than two million five hundred thousand ringgit.

Exemption 4.

(1)

Subject to paragraph 5, the Minister exempts a principal hub in the basis period for a year of assessment from the payment of income tax in respect of the statutory income derived from core income generating activities.

(2)

An application for exemption shall—

(a)

be made in writing by a principal hub and received by the Minister through the Malaysian Investment Development Authority on or after 1 January 2019 but not later than 31 December 2020; and

(b)

comply with the conditions imposed by the Minister.

(3)

An exemption granted under subparagraph (1) shall be subject to the principal hub complying with—

(a)

the conditions for the principal hub specified in Schedule 2 or

Schedule 3; and

(b)

any other conditions imposed by the Minister in the approval letter.

(4)

The exemption granted under subparagraph (1) shall be for a period of five consecutive years of assessment (hereinafter referred to as “the exempt years of assessment”) and the commencement of the exemption period shall be determined by the Minister.

(5)

The statutory income derived from core income generating activities referred to in subparagraph (1) in the basis period for each year of assessment shall be determined in accordance with the following formula:

P.U. (A) 251 22

(a)

in relation to qualifying services carried on by the principal hub—

B where

A is the amount of tax charged on the chargeable income of the principal hub from the qualifying services at the prevailing tax rate as provided for in paragraph 2 of Part I of Schedule 1

to the Act reduced by the amount of tax charged on such chargeable income from the qualifying services at the rate of ten per cent;

B is the amount of tax charged on the chargeable income of the principal hub from the qualifying services at the prevailing tax rate as provided for in paragraph 2 of Part I of Schedule 1

to the Act; and

C is the amount of the chargeable income of the principal hub from the qualifying services; or

P.U. (A) 251 23

(b)

in relation to qualifying trading activities carried on by the principal hub—

B where

A is the amount of tax charged on the chargeable income of the principal hub from the qualifying trading activities at the prevailing tax rate as provided for in paragraph 2

of

Part

I of Schedule 1 to the Act reduced by the amount of tax charged on such chargeable income from the qualifying trading activities at the rate of ten per cent;

B is the amount of tax charged on the chargeable income of the principal hub from the qualifying trading activities at the prevailing tax rate as provided for in paragraph 2

of

Part

I of Schedule 1 to the Act; and

C is the amount of the chargeable income of the principal hub from the qualifying trading activities.

(6)

The statutory income referred to in subparagraph (1) in the basis period for each year of assessment shall be determined after deducting the allowances which fall to be made under Schedule 3 to the Act notwithstanding that no claim for such allowances has been made.

P.U. (A) 251 24

(7)

Nothing in subparagraph (1) shall absolve or be deemed to have absolved the principal hub from complying with any requirement to submit any return or statement of accounts, or to furnish any other information, under the Act.

Exclusion of intellectual property income 5.

(1)

In ascertaining the statutory income of a principal hub referred to in subparagraph 4(1), the following intellectual property income derived from core income generating activities of the principal hub shall be excluded:

(a)

royalties and other income are derived on or after 1 July 2018

but before 1 July 2021 from new intellectual property rights that the principal hub owns; and

(b)

royalties and other income are derived on or after 1 July 2021 from all intellectual property rights that the principal hub owns.

(2)

For the purposes of subparagraph (1)—

(a)

a principal hub owns an intellectual property right if the principal hub is the owner or the licensee of the right; and

(b)

royalties and other income are derived from an intellectual property right if they are receivable as consideration for the commercial exploitation of the right.

(3)

Any intellectual property income referred to in subparagraph (1)

is subject to tax under the Act.

(4)

In this paragraph—

“intellectual property right” means a right arising from any patent, utility innovation and discovery, copyright, trade mark and service mark, industrial design, layout-design of integrated circuit, secret processes or formulae and know-how,

P.U. (A) 251 25

geographical indication and the grant of protection of a plant variety, and other like rights, whether or not registered or registrable;

“new intellectual property right” means an intellectual property right in relation to the core income generating activities of the principal hub that comes into the ownership of the principal hub—

(a)

on or after 1 July 2018; or

(b)

after 16 October 2017 but before 1 July 2018 as a result of an acquisition by the principal hub, directly or indirectly, from a related company.

Tax treatment for principal hub that suffered losses 6.

(1)

Where a principal hub is ascertained to have an adjusted loss under subsection 44(2) of the Act for the basis period for a year of assessment during the exempt years of assessment in respect of a business source consisting of qualifying services or qualifying trading activities, the amount of adjusted loss shall be disregarded from the source consisting of qualifying services or qualifying trading activities and other businesses.

(2)

Where a principal hub is ascertained to have an adjusted loss under subsection 43(2) of the Act for the basis period for a year of assessment during the exempt years of assessment in respect of a business source consisting of qualifying services or qualifying trading activities, the amount of adjusted loss shall be disregarded from the source consisting of qualifying services or qualifying trading activities and other businesses.

(3)

Any amount of adjusted loss ascertained pursuant to subsections 43(2)

and 44(2) of the Act in respect of a business source consisting of qualifying services or qualifying trading activities shall be disregarded for the purposes of the Act in the year of assessment in which the last date of the exempt years of assessment of the principal hub falls and in the following years of assessment after the exempt years

P.U. (A) 251 26

of assessment, as the case may be.

Withdrawal of exemption 7.

(1)

The

Minister may withdraw the exemption granted under subparagraph 4(1) if in any year of assessment of the exempt years of assessment, the principal hub fails to comply with any conditions imposed in relation to the exemption.

(2)

Where the exemption is withdrawn in accordance with subparagraph (1), the exemption granted in respect of any amount of the statutory income under subparagraph 4(1) shall be deemed to have not been given to the principal hub for that year of assessment.

(3)

Notwithstanding subparagraphs (1) and (2), where in any year of assessment of the exempt years of assessment, the principal hub fails to comply with any conditions imposed in relation to the exemption, paragraph 4 shall not apply.

Surrender of exemption 8.

(1)

The Minister may, at any time, except where the principal hub fails to comply with any conditions imposed in relation to the exemption, allow the principal hub to surrender the exemption granted under this Order by notice in writing to the Minister through the Malaysian Investment Development Authority.

(2)

The surrender of the exemption shall have effect from the year of assessment in which the application for surrender of the exemption is received by the Minister through the Malaysian Investment Development Authority provided that all conditions for the relevant category of principal hub specified in Schedule 2 or

Schedule 3 are complied with.

Separate source and separate account 9.

(1)

Where a principal hub carries on qualifying services, qualifying trading activities or activity other than core income generating activities, each activity shall be treated as a separate and distinct source of activity of the principal hub.

P.U. (A) 251 27

(2)

The principal hub which is granted an exemption under subparagraph 4(1)

shall maintain a separate account for the income derived from each activity referred to in subparagraph (1).

Non-application 10.

This Order shall not apply to a principal hub which in the exempt years of assessment—

(a)

has made a claim for reinvestment allowance under Schedule 7A to the Act or investment allowance for service sector under Schedule 7B to the Act;

(b)

has been granted any incentive under the Promotion of Investments

Act 1986;

(c)

has been granted an exemption under paragraph 127(3)(b) or subsection 127(3A) of the Act; or

(d)

has made a claim for deduction under any rules made under section 154

of the Act except—

(i)

the rules in relation to allowance under Schedule 3 to the Act;

(ii)

the Income Tax (Deduction for Audit Expenditure) Rules 2006

[P.U. (A) 129/2006];

(iii)

the Income Tax (Deduction for Expenses in relation to Secretarial

Fee and Tax Filing Fee) Rules 2014 [P.U. (A) 336/2014]; or

(iv)

the Income Tax (Deduction for Expenses in relation to Secretarial

Fee and Tax Filing Fee) Rules 2020 [P.U. (A) 162/2020].

P.U. (A) 251 28

SCHEDULE 1

[Paragraph 2]

(1)

(2)

Cluster

(3)

Qualifying service

1.

Strategic services

(a)

Regional profit and loss or business unit management

(b)

Strategic business planning and corporate development

(c)

Corporate finance advisory services

(d)

Brand management

(e)

Intellectual property management

(f)

Senior-level talent acquisition and management

2.

Business services

(a)

Bid and tender management

(b)

Treasury and fund management

(c)

Research, development and innovation

(d)

Project management

(e)

Sales and marketing

(f)

Business development

P.U. (A) 251 29

(1)

(2)

Cluster

(3)

Qualifying service

(g)

Technical support and consultancy

(h)

Information management and processing

(i)

Economic or investment research analysis

(j)

Strategic sourcing, procurement and distribution

(k)

Logistics services

3.

Shared services

(a)

Corporate training and human resource management

(b)

Finance and accounting (transactions, internal audit)

P.U. (A) 251 30

SCHEDULE 2

[Paragraphs 4 and 8]

Conditions for a principal hub which does not have an operational headquarters, an international procurement centre or a regional distribution centre status which carries on core income generating activities

1.

Minimum number of full-time new employees in Malaysia with a minimum salary of five thousand ringgit per month and at least fifty per cent of that new employees are Malaysians

(a)

30 persons; or

(b)

existing number of full-time employees plus thirty per cent, whichever is higher

2.

Minimum number of full-time new employees in Malaysia with a minimum salary of twenty five thousand ringgit per month

5 persons

3.

Minimum amount of annual operating expenditure in Malaysia

(in Ringgit Malaysia)

(a)

RM10,000,000.00; or

(b)

average operating expenditure for the three years of assessment immediately preceding the exempt years of assessment plus thirty per cent, whichever is higher

P.U. (A) 251 31 4.

Minimum number of qualifying services

4 (including two qualifying services from items (a) and (b) of cluster 1

of Schedule 1)

5.

Minimum amount of annual value of sales (in Ringgit Malaysia)

(additional condition for a principal hub which carries on qualifying trading activities)

(a)

(b)

average annual value of sales for the three years of assessment immediately preceding the exempt years of assessment, whichever is higher

SCHEDULE 3

[Paragraphs 4 and 8]

Conditions for principal hub that has been approved by the Minister as an operational headquarters, an international procurement centre or a regional distribution centre status and has been approved incentive for operational headquarters, international procurement centre or regional distribution centre which carries on core income generating activities

1.

Minimum number of full-time new employees in Malaysia with a minimum salary of five thousand ringgit per month and at least fifty per cent of that new employees are Malaysians

(a)

60 persons; or

(b)

existing number of full-time employees plus twenty per cent, whichever is higher

P.U. (A) 251 32 2.

Minimum number of full-time new employees in Malaysia with a minimum salary of twenty five thousand ringgit per month

5 persons 3.

Minimum amount of annual operating expenditure in Malaysia

(in Ringgit Malaysia)

(a)

RM13,000,000.00; or

(b)

average operating expenditure for the three years of assessment immediately preceding the exempt years of assessment plus twenty per cent, whichever is higher

4.

Minimum number of qualifying services

4 (including two qualifying services from items (a) and (b) of cluster 1

of Schedule 1)

5.

Minimum amount of annual value of sales (in Ringgit Malaysia)

(additional condition for a principal hub which carries on qualifying trading activities)

(a)

(b)

average annual value of sales for the three years of assessment immediately preceding the exempt years of assessment, whichever is higher

P.U. (A) 251 33

Conditions for principal hub that has been approved by the Minister as an operational headquarters, an international procurement centre or a regional distribution centre status and has not been approved incentive for operational headquarters, international procurement centre or regional distribution centre which carries on core income generating activities

1.

Minimum number of full-time new employees in Malaysia with a minimum salary of five thousand ringgit per month and at least fifty per cent of that new employees are Malaysians

Existing number of full-time employees plus thirty per cent 2.

Minimum number of full-time new employees in Malaysia with a minimum salary of twenty five thousand ringgit per month

5 persons 3.

Minimum amount of annual operating expenditure in Malaysia

(in Ringgit Malaysia)

(a)

RM10,000,000.00; or

(b)

average operating expenditure for the three years of assessment immediately preceding the exempt years of assessment plus thirty per cent, whichever is higher

4.

Minimum number of qualifying services

4 (including two qualifying services from items (a) and (b) of cluster 1

of Schedule 1)

P.U. (A) 251 34 5.

Minimum amount of annual value of sales (in Ringgit Malaysia)

(additional condition for a principal hub which carries on qualifying trading activities)

(a)

(b)

average annual value of sales for the three years of assessment immediately preceding the exempt years of assessment, whichever is higher

Made 18 August 2023

[Perb.:MOF.TAX(S)700-2/1/202; LHDN.AY.A600-12/1/7(29)-303; PN(PU2)80/JLD.109]

ANWAR BIN IBRAHIM

Minister of Finance

[To be laid before Dewan Rakyat pursuant to subsection 127(4) of the Income Tax Act 1967]