Stamp Duty Exemption
Stamp duty exemption (up to RM1,000,000 on property value) is granted to individual acquiring property valued between RM300,000 to RM2,500,000. The exemption is applicable for instruments of transfer for the purchase of residential property under National Home Ownership Campaign 2019. The exemption has been extended to 31 December 2019.
Excise Duties on Sweetened Beverages
Effective 1 July 2019, new excise duty will be imposed on sweetened beverages under Item 20.09 of Chapter 20 and Item 22.02 of Chapter 23 of the Schedule to the Excise Duties Order 2017.
The excise duty becomes due:-
(i)for licensed manufacturer, at the time the sweetened beverages are removed from the place licensed for consumption within Malaysia;
(ii)for licensed warehouse, at the time the sweetened beverages are removed from the licensed warehouse for consumption within Malaysia.
The excise duty becomes payable in any calendar month, not later than the last day of the following month from expiration of taxable period.
Earning Stripping Rules
Pursuant to s. 140C of the Income Tax Act 1967 (also known as Earning Stripping Rules (“ESR”)), the Inland Revenue Board published a new ESR Guideline on 5 July 2019. The adoption of ESR is IRB’s commitment towards the OECD’s Base Erosion and and Profit Shifting (BEPS) framework.
These rules shall apply to:-
i)Person who has granted any financial assistance in a controlled transaction;
ii)Interest expense for such financial assistance exceeds RM500,000; and
iii)Basis period beginning on or after 1 July 2019.
The maximum amount of interest allowable for tax deduction shall be an amount equal to 20% of tax-EBITDA* of the person from each of his sources consisting of a business for basis period for a year of assessment (“YA”)
Interest expenses which are restricted in a YA (“unabsorbed interest expenses”) shall be allowed to be carried forward and deducted against the adjusted income of the Company for subsequent YA, subject to the maximum amount equal to 20% of tax-EBITDA. In addition, a shareholding test will be conducted to ensure the ordinary shareholders of the Company on first day and last day of the basis period is substantially the same.
* EBITDA means earnings before interest, taxes, depreciation and amortisation.
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