Forest City’s New Incentives: The Next Hotspot for Global Investors

Malaysia has introduced attractive tax incentives to position Forest City in Johor as a premier investment destination for international companies, including family offices. The Forest City Special Financial Zone (FC-SFZ) offers a competitive advantage over other countries in the region.

With attractive, competitive tax rates, investors can enjoy substantial cost-saving advantages, positioning Forest City as a prime location for regional headquarters, particularly for sectors like financial services, digital technology, logistics and research and development.

The Malaysian Government’s newly introduced incentives feature a competitive corporate tax rate ranging from zero to five per cent, and a special 15 per cent individual income tax rate for knowledge workers and Malaysians who choose to work in the country.

Forest City will be the first location in Malaysia to offer a zero tax on family wealth offices, a groundbreaking incentive designed to attract both regional and Malaysian families to manage their wealth from Malaysia. With approximately 8,030 single-family offices worldwide, and projections showing a 75 per cent increase to over 10,720 by 2030, the market for family wealth management is rapidly expanding. Total assets under management by these offices are expected to surge from USD3.1 trillion to USD5.4 trillion by 2030.

The streamlined visa policies within the Forest City Special Financial Zone are set to draw world-class talent, especially in high-demand industries like technology, finance, and services.

The newly introduced long-term visa options, designed by the Government to simplify relocation, allow talent to easily settle and work. This policy is expected to ease hiring challenges, enrich the local workforce with foreign expertise and facilitate valuable knowledge transfer.

Located near Singapore, Johor’s strategic location, combined with the Johor- Singapore Special Economic Zone (JS-SEZ), offers a compelling alternative for regional expansion. These initiatives align with the government’s vision to position Malaysia as a competitive investment destination in Southeast Asia.

This momentum builds on the January 2024 signing ceremony of the Memorandum Understanding on the JS-SEZ, witnessed by Prime Minister YAB Dato’ Seri Anwar Ibrahim and his then Singaporean counterpart Mr. Lee Hsien Loong.

FC-SFZ is poised to become a magnet for global talent, drawing top professionals from high-tech services and innovative industries. This initiative aims to position Forest City as a thriving hub for growth, creativity, and high value employment opportunities. A reduced tax rate lies at the heart of the government’s strategy to attract international expertise and foster knowledge-based industries to establish a strong presence in Malaysia.

Skilled workforce in sectors such as global services, financial technology, and digital technology are anticipated to drive forward economic development and accelerate advancements. This policy aligns with the increasing demand for top talent as multinational corporations (MNCs) and start-ups target the region for their growth ambitions, aligned with the Government’s aspiration in positioning Malaysia as a Global Services Hub by 2025, as outlined under the Twelfth Malaysia Plan (12MP).

In addition to the competitive tax rate, the introduction of multiple-entry visas is a game-changer for foreign professionals. These visas offer greater flexibility and ease of mobility for those working or investing in Malaysia, significantly reducing administrative hurdles. This streamlined process will make it even more appealing for top talent to relocate and will empower business owners and investors to engage in cross-border activities with enhanced efficiency.