Malaysia could extend tax breaks for key foreign investors — Dr M

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KUALA LUMPUR: Malaysia could extend new tax incentives for foreign investment in areas such as technology if companies promise to create better-paid jobs for Malaysians, Prime Minister Tun Dr Mahathir Mohamad said on Tuesday.

His comments could reassure investors in Southeast Asia’s third biggest economy after Dr Mahathir started a review of major projects sanctioned by former premier Datuk Seri Najib Razak, especially the ones involving Chinese firms, following an unexpected election victory last month.

Dr Mahathir told Reuters in an interview that his government would welcome investment “from China or any other country” if companies were willing to commit to projects that would create jobs for skilled workers in areas like technology and research and development.

“Before we needed jobs, so people who had huge assembly lines employing manual labour, they were welcome. But now we want intellectual workers.”

To attract investments, Dr Mahathir said in some cases the government could extend tax breaks beyond 10 years, the outer limit of the tax incentives currently on offer. Up until now, the Malaysian Investment Development Authority has allowed companies investing in the country to claim income tax breaks for between five and 10 years.

“Already we are willing to forego tax for 10 years and maybe more than that,” Dr Mahathir said.

“We can give them whatever incentive we can afford. Our main aim is to create jobs for our people.”

The kind of investment the new government wanted to see, Dr Mahathir cited Alibaba Group’s move to open an office in Malaysia this week. — Reuters