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MDEC to introduce new tax incentive for Malaysia Digital status companies

The Malaysia Digital Economy Corp (MDEC) will be introducing a new tax incentive for Malaysia Digital status companies and existing Multimedia Super Corridor (MSC) status companies.

Its chief executive officer Mahadhir Aziz said the tax incentive, to be announced in May, will be for digital initiatives in intellectual property (IP) and non-IP, and also in the form of investment tax allowance incentives.

“We have an amended tax incentive that will be announced in May 2024. This is something that we want to be able to take on and we will announce it together with the Ministry of Finance,” he said at a media briefing on Monday.

The Malaysia Digital initiative, launched in July 2022 to succeed MSC Malaysia, is the new national strategic initiative by the government to drive digital transformations by encouraging and attracting companies, talents and investment while enabling Malaysian businesses to play a leading part in the global digital revolution and digital economy.

Under its ecosystem, the Malaysia Digital initiative looks to promote nine sectors, namely digital trade, digital agriculture, digital services, digital cities, digital health, digital finance, digital content, digital tourism and Islamic digital economy.

Digital investments hit RM46.22 billion in 2023, exceeding target by 54%
Mahadhir said MDEC has facilitated RM46.22 billion in digital investments in 2023, exceeding its target of RM30 billion by 54%. This was contributed by digital investments from 256 different companies, including Amazon Web Services, Siemens Energy and American Express.

From the investments, Mahadhir reported that 22,258 high-value jobs were created in 2023.

The Malaysia Digital companies collectively achieved revenue of RM8.87 billion in 2023, exceeding MDEC’s target of RM7.5 billion by 18%.

MDEC also facilitated RM3.18 billion worth of digital exports in 2023, growing about 81% from 2021. These exports went to 17 countries led by Indonesia, the Philippines and Vietnam.

  • The Edge Markets