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Multimedia Super Corridor (MSC) (Part 3)
Published by slang October 23rd, 2006 in Corporate TaxThis final part dealt with the incentives of being MSC accreditation and the application procedures to seek MSC status.
Besides the earlier mentioned Bill of guarantees (part 1), the following are the incentives given:
| Financial Incentives |
| ·Malaysian income tax exemption on statutory income for 5 years extendable to 10 years, or 100% investment tax allowance (ITA) on qualifying capital expenditure for 5 years to be utilized against statutory income for 5 years for new companies which are engaged in highly capital-incentives activities or whose multimedia activities are treated as cost centres
|
| ·Effective YA 2006, Industrial Building Allowance for 10 years would be given to owners of new buildings occupied by MSC-status companies in Cyberjaya (including completed buildings which are yet to be occupied by MSC status companies) |
| ·No duties on importation of multimedia equipment used directly in the operation of business |
| ·R & D grants for local small and medium-sized enterprises in the MSC that are at least 51% Malaysian-owned |
| ·Effective 1/10/2002, non-resident companies are exempted from payments of income tax in Malaysia in respect of the following types of income received from the approved MSC status company:-Payment for technical advice or technical services;
-Licensing fees in relation to technology development and -Interest on loans for technology development Here, it means that MSC company is exempted from deducting the withholding tax under s.109 and s.109B of the Income Tax Act 1967( Income Tax (Exemption )(No 13) Order 2005) |
| ·Applications received from 1/10/2005, selected companies recommended by MDC which undertake ICT and multimedia activities including Regional Shared Service Centres located outside the designated Cybercities will be given the following incentives:-Malaysian income tax exemption on 50% statutory income for a period of 5 ears or
-Investment tax allowance (ITA) of 50% on qualifying capital expenditure for 5 years to be utilized against 50% of statutory income for 5 years. |
However, for companies already operating in Malaysia, the MSC tax incentives will apply to the “value-added” income which is defined as the company’s additional statutory income above the average income for the past three years or to thevalue of new investment made in the MSC.
| Non-Financial Incentives & Others |
| ·No restriction on the employment of foreign knowledge workers |
| ·Support from the MDC’S one-stop client centre that will expedite visas and other licences and permits (PS: Multimedia Development Corporation(MDC) is the vehicle established to take charge of the development and implementation of MSC) |
| ·Freedom of ownership |
| ·Exemption from exchange control and foreign currency regulations |
| ·Intellectual property protection and a pioneering and comprehensive framework of cyber laws can be enjoyed by MSC- status applicant irrespective of location |
| ·Internet free from censorship for the benefit of companies, IHL or faculties granted MSC status irrespective of location |
| ·Within the MSC, the applicants enjoyed:-World class physical and IT environment
-Globally competitive telecommunication tariffs and service guarantees -Excellent R& D facilities, including the region’s first multimedia University -Green environment protected by strict zoning |
Lastly, those who are interested in apply for MSC status and incentives should submit the following documents to the Multimedia Development Corporation (MDC):
-Completed application form for MSC status
-Three year business development plan
-Copy of the past three annual reports or audited accounts for each substantial incorporated shareholder in the proposed MSC company
-Processing fee of Malaysian Ringgit 2,000
As mentioned earlier, MDC serves as the promoter and facilitator for companies intending to set up operation in the MSC.
For those who wished to have specific application procedures for IHL, Incubators and SSO, you refer to MDC’s website: http://www:mdc.com.my
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Related Entries
- Multimedia Super Corridor (MSC) (Part 1)
- International World Class MSC Malaysia Status Companies
- Malaysia Moving Forward – Abolishment of Real Property Gains Tax & Special Incentive Area –Iskandar Development Region
- Tax Incentives For The Venture Capital Industry
- Multimedia Super Corridor (MSC) (Part 2)
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