No negative impact from withholding tax exemption, says MITI deputy minister

KUALA LUMPUR: The government believes the exemption for withholding tax on overseas firms providing services in Malaysia will not have a negative impact on its revenue in the future, according to Deputy Minister of International Trade and Industry (MITI) Datuk Chua Tee Yong.

"Basically, a lot of the businesses have given feedback to us that the issues they face have been resolved. And I think the government has already anticipated the revenue in terms of what is expected," he told reporters after officiating the Malaysian Institute of Accountants' International Accountants Conference 2017 (MIA Conference 2017) here today.

Chua also believes that the Ministry of Finance (MoF) have met with the industry players before making the tax relief announcement.

On Oct 24, 2017, the MoF announced the exemption for withholding tax on overseas firms providing services in Malaysia, effectively rolling back the status to pre-January 2017.

Prior to the relief, companies using overseas expertise would have needed to set aside a 10% portion of the payment for services to be remitted to the Inland Revenue Board.