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Green Technology
Strategic reason that makes Malaysia one of South East Asia’s favourite investment destinations is that the country is no stranger to the sustainable development journey. The nation’s treasure trove of natural resources is supplemented by the well-established New Economic Policy (NEP) – a running five-year development plan introduced in the 1970s that has underpinned all development in the country ever since, instilling essential elements of sustainable economic development.
In recent years, Malaysia has accelerated its pursuit of a low-carbon and more resource efficient energy economy path to protect its irreplaceable environmental assets and to create wealth for investors and the rakyat.
Domestic Investments – RM3.1 bil (95.3%)
Foreign Investments – RM0.1 bil (4.7%)
For more statistics, please click here.
The Green Technology incentive has been introduced since 2001 to encourage investments in green technology industries on a project basis either for business purposes or own consumption with the adoption of green technologies by selected services/service providers.
Now, the Green Technology incentives facilitations are extended until 2026 and the extensions includes enhancements based on a tiering and outcome-based approach as below:
Tier 1: Green Hydrogen
Investment tax allowance (ITA) of 100% for eligible qualifying capital expenditure (CAPEX) incurred up to 10 years (5+5). Offset against 100% or 70% of Statutory Income.
Tier 2: Integrated Waste Management (IWM) & EV Charging Station
Investment Tax Allowance (ITA) of 100% for eligible qualifying capital expenditure (CAPEX) incurred for 5 years from the date first qualifying CAPEX incurred. Offset against 100% of Statutory Income.
Tier 3: Renewable Energy (Business Purposes)
Investment Tax Allowance (ITA) of 100% for eligible qualifying capital expenditure (CAPEX) incurred for 5 years from the date first qualifying CAPEX incurred. Offset against 70% of Statutory Income.
RE Sources: Biomass, Biogas, Small Hydro, Geothermal, Solar and Wind Energy
GITE: Solar Leasing
Income Tax Exemption (ITE) of 70% statutory income for solar leasing activity for a period of up to 10 years of assessment. The incentive period shall commence from the date of first invoice issued.
|
Capacity (MW) |
Incentive period |
| >3MW- ≤10MW |
5 years |
| >10MW- ≤30MW |
10 years |
* ELIGIBILITY: Companies MUST APPLY to MIDA prior to incurring any qualifying CAPEX. Applicable for Tier 2, Tier 3 and GITE- Solar Leasing.
