MITI Manufacturing License was a license given for manufacturer that comply the conditions which is paid-up capital is RM2.5 million and above OR full-time workers must be at least 75 peoples. Many of companies not aware about it and also not fulfill the condition thus do not apply it. However, for those manufacture that do not match the condition, can get the Exemption Letter of Manufacturing License where enjoying same benefit as Manufacturing License.
Below is the ADVANTAGEs of getting a Manufacturing License OR Exemption Letter from Manufacturing License: -
• Can apply the Incentive which is income tax exemption (for those applicable);
• Can apply Automation Capital Allowance
• Can apply for Duty Tax and Sales Tax Exemption for raw materials, equipment, machinery and spare parts that directly used in manufacturing;
• Can apply the grant with Government and Statutory Body;
• Can register with Ministry of Finance as their suppliers:
• Can apply the Certificate of Origin;
• Can apply the the expatriate posts and
• Easy to work and get help from MITI on any kind of issue.
Incentive (Income Tax Exemption) are given to the manufacturer that producing the products that listed in promoted list. This applicable only for the new products that manufactured less than 1 years. The incentive consists of Pioneer Status (PS) or Investment Tax Allowance (ITA). Both of it are unique and can help manufacturer a lot in saving their money. PS are income tax exemption up to 70% from statutory income form 5 years. Meanwhile, for ITA is an allowance given by government to not pay a tax up to 60% from their project cost for 5 years.
Grant was a gifted fund from government. There is a lot of grant which is for purchasing of new machinery/technology, acquiring a new technology, R&D, acquiring a testing standard, training and many more. These grants were given by government on selected ministry and statutory body.
Duty Tax Exemption Business given to the manufacturer that doing the export. The company can apply the waive of duty tax exemption on Imported Raw Material, Machine, Spare Parts, Equipment and Consumables Item.
Automation Capital Allowance given to existing manufacturing company that buying the machine from 2015 until 2021. Government will give the allowance of 200% on RM2 million or RM4 million first expenditure of machine. The company can claim back the tax that they already paid on respective year that they buy the machine.
Certificate of Origin is useful for the company that doing the export and they can have it to help their customer waive the duty or tax.