To Our Valued Clients
On 17th March 2021, the Government has announced the PEMERKASA Stimulus Package ["PEMERKASA"] worth RM 20 billion. The objectives of PEMERKASA are as follows:-
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Controlling COVID-19 pandemic |
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Steering economic recovery |
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Strengthening the country's competitiveness |
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Ensuring inclusivity |
The salient points of PEMERKASA are as summarised below:-
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Further Deduction for Rental Expenses on Premises and Hostels for Employees |
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Further deduction for rental expense on premises and hostels for employees will be given to manufacturing companies and service companies related to manufacturing that participate in the Safe@Work programme implemented by the Ministry of International Trade and Industry ["MITI"] |
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The amount eligible for the further deduction is restricted to RM50,000 for each company that registered with MITI for the Safe@Work programme and passed the Safe@Work compliance audit |
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Companies can apply for registration of the above from 1st April 2021 onwards |
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| ii. |
Further Deduction for Costs of COVID-19 Detection Tests Incurred on Employees |
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Further deduction on the costs related to COVID-19 detection tests for employees incurred up to 31st December 2021 be given to employers |
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| iii. |
Wage Subsidy Programme ["WSP"] 3.0 |
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The WSP was first introduced under the Prihatin Economic Stimulus Package to provide financial assistance to employers for local employees earning RM4,000 or less |
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Under Budget 2021, the WSP was further extended with a more targeted approach specifically for the tourism and retail sectors. The subsidy is at the rate of RM600 per employee for workers earning RM4,000 or less and limited to 500 eligible employees |
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Under PERMAI Stimulus Package, it was proposed that all employers operating in the Movement Control Order ["MCO"] states will be eligible to apply for the subsidy of RM600 per employee irrespective of sector, up to maximum of 500 eligible employees, for a period of one (1) month under WSP 3.0 |
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It is proposed that WSP 3.0 be extended by another 3 months, focusing on tourism, wholesale and retail traders, as well as other business (e.g. gymnasiums and spas) which were unable to operate during the MCO periods |
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| iv. |
Expansion of Scope of Tax Relief for Domestic Travel Expenditure |
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Currently, a personal tax relief up to RM1,000 is given to resident individuals for the accommodation expenses at premises registered with the Ministry of Tourism, Arts and Culture ["MOTAC"] and entrance fees to tourist attractions |
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It is proposed that the scope of the tax relief up to RM1,000 be expanded to include the purchase of tourism packages from travel agents registered with MOTAC |
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| v. |
Other Incentives for Tourism and Selected Sectors |
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To ease burden and support the recovery of the tourism and selected sectors, it is proposed that:- |
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companies in the tourism industry and selected industries (e.g. cinemas and spas) be allowed to defer their monthly tax instalment payments from 1st April 2021 to 31st December 2021 |
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the tax incentive for tour operators be extended until the year of assessment 2022 |
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tourism tax and service tax exemptions on accommodation provided by hotel operators be extended to 31st December 2021 |
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entertainment duty exemption be given on entrance fees to theme parks, stage performances, sports events and movie screenings in the Federal Territories of Kuala Lumpur, Putrajaya and Labuan |
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| vi. |
HRDF Levy Exemption |
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It is proposed that exemption from payment of Human Resource Development Fund ["HRDF"] levy be granted to companies in tourism and retail sectors until June 2021 |
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| vii. |
Excise Duty Exemption on Locally Assembled Motorcycles |
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It is proposed that 100% excise duty exemption be given to locally assembled motorcycles with engine capacity of 150cc and below under the TEKUN Mobilepreneur programme |
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The exemption is applicable from 1st April 2021 to 31st December 2021 |
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For further information, kindly refer to the text of the speech for the PEMERKASA Stimulus Package (in Bahasa Malaysia only).
Please do not hesitate to contact us if you need any clarification on the foregoing.