FINANCIAL INCENTIVES FOR GREEN TECHNOLOGY AS ANNOUNCED UNDER BUDGET 2020

Extension of Green Investment Tax Allowance (GITA) & Green Income Tax Exemption (GITE) until 2023

Green Investment Tax Allowance – GITA (Project) :

  • ITA of 100% of qualifying capital expenditure incurred on a green technology project from the date on which the first qualifying capital expenditure incurred (application received before 1st January 2020) until 31 December 2020 or up to 3 years; or
  • ITA of 100% of qualifying capital expenditure incurred on a green technology project from the date on which the first qualifying capital expenditure incurred (application received start 1 January 2020) until 3 years.
  • The allowance can be offset against 70% of statutory income in the year of assessment.
  • Qualifying activities comprises of Renewable Energy, Energy Efficiency, Green Building, Green Data Centre and Integrated Waste Management Activity.

Green Income Tax Exemption – GITE (Services) :

  • ITE of 100% of statutory income from the year of assessment where the date of application received by MIDA before 1st January 2020 until the year of assessment 2020 or up to 3 years of assessment.
  • ITE of 70% of statutory income from the year of assessment where the date of application received by MIDA start 1 January 2020 until 3 year of assessment.
  • Qualifying activities under GITE encompasses Renewable Energy, Energy Efficiency, Green Building, Green Data Centre, Green Township, Certification/Verification and Electric Vehicles (EV).
  • Details as table below:
DetailsApplication before January 2020Application starts 1 January 2020
Exemption rate100% of Statutory Income70% of Statutory Income
Exemption period31 December 2020 or up to 3 years of assessment3 years of assessment
Incentive period Application for extension must be before 31 December 20201 January 2020 – 31 December 2023
ConditionsAs current guidelines until 31 Dec 2019New condition and criteria starts 1 January 2020

Green Income Tax Exemption – GITE (Leasing) :

  • ITE of 70% of statutory income from the year of assessment where the date of application received by MIDA start 1 January 2020 up to 10 years of assessment and companies are undertaking solar leasing activities.

For any latest Procedures, Guidelines and Forms kindly download from MIDA website. Please click here for further information.

Green Technology Financing Scheme 2.0 (GTFS 2.0)

GTFS is a financing scheme offered to investors which is supported by the government offering a 2% p.a. interest/profit rate subsidy for the first seven years and 60% government guarantee of green component cost to financial institutions.

For more information please visit : https://www.gtfs.my/