Malaysia: Tax developments summary (May 2025)

Updated guidelines and FAQs for digital tax incentives

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May 15, 2025

The KPMG member firm in Malaysia has prepared its monthly report for May 2025, covering the following income tax, indirect tax, and individual (personal) tax developments.

Income tax

  • Expansion of qualifying services for increased exports
  • Amended legislation for income tax exemption for Labuan-related income
  • Malaysia Digital Economy Corporation (MDEC) updated guidelines and “frequently asked questions” (FAQs) for Malaysia digital tax incentives
  • Deduction for pre-petroleum agreement expenditure

Indirect tax

  • Guidelines on applications for sales tax exemption and refund on mastectomy bras that are imported or purchased from registered manufacturers
  • Indirect tax legislation updates

Individual tax

  • Computation of chargeable dividend income for dividend tax

Johor-Singapore special economic zone (SEZ)

  • Guidelines for Johor-Singapore SEZ tax incentive package
  • Guidelines for Forest City special financial zone (SFZ) tax incentive package
  • Guidelines and FAQs on Forest City SFZ tax incentive for fintech-related activities, financial global business services, and foreign payment system operator

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