Forest City will be the first location in Malaysia to offer a 0% tax rate for family offices, said Finance Minister II Datuk Seri Amir Hamzah Azizan in a press conference after the launch of the incentive package for Forest City Special Financial Zone by Johor Regent Tunku Ismail Sultan Ibrahim on Friday (Sept 20).
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NewsTranscript
00:00Forest City enjoys several incentives.
00:05In the event of the launch of the Forest City Special Financial Zone,
00:10this is part of the monetary economy.
00:13Last year we announced it in August,
00:16and this year we want to highlight it.
00:18What do we do?
00:19We create a special financial zone
00:22where we hope we can attract
00:25industry players in the financial sector
00:30to come to Malaysia
00:32to develop another segment in Malaysia
00:35that we don't have in Malaysia.
00:38So I listed several areas in our financial zone.
00:43First, we want to launch the family office sector.
00:48Because we know that around the world now
00:51there are a lot of people with assets
00:56that are controlled by family offices
00:59that are growing.
01:01Usually they are placed in financial zones
01:04or financial zones in several places abroad.
01:08But we want them to come to Malaysia.
01:11To attract them to come to Malaysia,
01:13we say there are several interesting things here.
01:17In Forest City, if we look outside,
01:20the infrastructure is already there.
01:23The location is ideal.
01:25Close to Singapore,
01:27close to all existing institutions.
01:29So we can complement what is there.
01:33Third, what we do to attract them,
01:36we give a little incentive for them to come here.
01:39We attract them with a tax exemption
01:43and incentives for them to relocate to this country.
01:48We also facilitate the process of application
01:52for them to do business in this country.
01:55We have a special facilitation center
01:58that we located in Forest City
02:01to help attract more family offices.
02:06Family offices from around the world
02:08are expected to be bigger
02:10and they will control assets under management.
02:15More than US$7 trillion in 2030.
02:21This is more than 75% of what we have now.
02:25So we hope that half of that money will go to Malaysia.
02:30When you mentioned that 0% tax rate
02:33for family offices,
02:34can you elaborate on what does it apply to
02:37and what does that mean?
02:39The 0% tax rate is a profit that you earn
02:42on the transactions that you do in this country.
02:44So as you file your normal tax,
02:46we'll give you a 0% tax rate for 10 years.
02:49And there's an obligation that if you want to renew this,
02:52then you have to scale up your operation
02:54by adding more people,
02:55by adding more investment in the country
02:57and also adding the asset under management in the country.
03:00But there's clarity here.
03:01This is not a once-off incentive.
03:03It's a 10-year incentive plus an option to extend it
03:06if you are able to scale it up to the right form.
03:08So it is a win-win solution that we're trying to do.
03:14For more UN videos visit www.un.org