INCOME TAX (DEDUCTION FOR INVESTMENT IN AN APPROVED FOREST PLANTATION

IN exercise of the powers conferred by paragraph 154(1)(b) of the Income Tax Act 1967 [Act 53], the Minister makes the following rules:

Citation and commencement

1. (1) These rules may be cited as the Income Tax (Deduction for Investment in an Approved Forest Plantation Project) Rules 2009.

(2) These Rules are deemed to have come into operation on 21 May 2003 and shall have effect subject to its application as prescribed in rule 3.

Interpretation

2. In these Rules—

“investment” means investment in the form of cash or paid-up capital in respect of ordinary shares in a related company;

“forest plantation project” means the project referred to in rule 3;

“related company” means a company—

(a) incorporated under the Companies Act 1965 [Act 125] and is resident in Malaysia;

(b) which expended the investment in undertaking a forest plantation project; and

(c) exempted under the Income Tax (Exemption) (No. 11) Order 2009;

“qualifying company” means a company incorporated under the Companies Act 1965 and resident in Malaysia which directly owns—

(a) prior to 11 September 2004, one hundred per cent of the paid-up capital in respect of ordinary shares of the related company; or

(b) on or after 11 September 2004, at least seventy percent of the paidup capital in respect of ordinary shares of the related company.

Application

3. (1) Subject to subrule (2), these Rules shall apply to the first forest plantation project undertaken by a related company for the species as specified in the Schedule.

(2) The application to undertake the forest plantation project referred to in subrule (1) shall be made to the Minister through the Minister charged with the responsibility for that project on or after 21 May 2003 but not later than 31 December 2011.

Deduction

4. (1) In ascertaining the adjusted income of a qualifying company from its business in the basis period for a year of assessment, there shall be allowed a deduction of an amount equivalent to the value of investment in a forest plantation project on the date the investment is made in the related company.

(2) The investment referred to in subrule (1)—

(a) shall be made for a period and up to the amount, as approved by the Minister, through the Minister charged with the responsibility for the forest plantation project;

(b) shall be for the sole purpose of financing a forest plantation project;

and

(c) shall not be disposed of within five years from the date of the last investment if such investment is in a form of paid-up capital in respect of ordinary shares.

(3) The investment made by the qualifying company prior to the commencement of a forest plantation project shall be deemed to have been incurred on the date the forest plantation project commences.

(4) Subject to subrules (5) and (6), where a qualifying company which has made an investment in the form of paid-up capital in respect of ordinary shares and claimed a deduction in respect of that investment under subrule (1), receives any consideration for the disposal of such shares, the value of consideration so received by that qualifying company shall be added in ascertaining his adjusted income for the year of assessment in the basis period in which that consideration was received.

(5) The value of the consideration referred to in subrule (4) shall not exceed the total deduction allowed in relation to that investment.

(6) Subrule (4) shall not apply where the disposal of the shares referred to in subrule (4) takes place after five years from the date of the last investment of paid-up capital in respect of ordinary shares is made in the related company.

Cessation of deduction

5. Where an investment is made by a qualifying company for the sole purpose of financing a forest plantation project is deducted under these Rules, the deduction shall cease to apply to the qualifying company in the basis period for a year of assessment upon which the related company has its first statutory income.



SCHEDULE

Item Specie Local Name

1. Acacia mangium, Acacia auriculiformis, Acacia Acacia
hybrids

2. Agathis borneensis Damar minyak (Peninsular)/ Bindang (Sarawak)/ Mengilan (Sabah)

3. Alstonia angustifolia, Alstonia angustiloba, Alstonia Pulai (Peninsular)/Pelai (Sarawak)
macrophylla, Alstonia pneumatophora, Alstonia
scholaris, Alstonia spatulata

4. Anisoptera costata, Anisoptera curtisii, Anisoptera Mersawa/Pengiran (Sabah)
grossivenia, Anisoptera laevis, Anisoptera marginata,
Anisoptera megistocarpa, Anisoptera scaphula

5. Araucaria cunninghamii Hoop pine
Araucarai hunstenii Klinki pine

6. Artocarpus altilis, Artocarpus elasticus, Artocarpus Cempedak/Terap
lowii, Artocarpus odoratissima, Artocarpus
scortechinii, Artocarpus tamaran, Artocarpus
teysmannii

7. Azadirachta excelsa Sentang (Peninsular)/Ranggu (Sabah, Sarawak)

8. Bischofi a javanica Javan cedar/Jitang/Tuai

9. Calamus manan Rotan manau
Calamus caesius Rotan sega

10. Calophyllum bifl orum, Calophyllum calaba, Bintangor
Calophyllum canum, Calophyllum coriaceum,
Calophyllum depressinervosum, Calophyllum
ferrugineum, Calophyllum inophyllum, Calophyllum
macrocarpum, Calophyllum pulcherrimum,
Calophyllum sclerophyllum, Calophyllum
symingtonianum, Calophyllum tetrapterum,
Calophyllum teysmannii, Calophyllum wallichianum

11. Campnosperma auriculatum, Campnosperma Terentang
coriaceum, Campnosperma squamatum

12. Cananga odorata Kenanga

13. Canarium apertum, Canarium littorale, Canarium Kedondong (Peninsular)/ Seladah (Sarawak)
pseudosumatranum

14. Casuarina cunninghamiana, Casuarina equisetifolia, Rhu/Jemara/Chemara
Casuarina glauca, Casuarina junghuhniana

15. Ceiba pentandra, Bombax ceiba, Bombax valetonii Kapok (Sabah)/Kekabu

16. Chukrasia tabularis Surian batu

17. Cinnamomum altissimum, Cinnamomum iners, Pokok Teja/Medang teja/ Medang
Cinnamomum sintoc, Cinnamomum javanicum,
Cinnamomum porrectum, Cinnamomum scortechinii

18. Coelostegia borneensis, Coelostegia griffi thii Punggai (Peninsular)/Durian hantu (Sarawak)

19. Cratoxylum arborescens, Cratoxylum glaucum Geronggang

20. Dacrydium beccarii, Dacrydium comosum, Dacrydium Sempilor/Ekor (Peninsular)
elatum, Dacrydium gibbsiae

21. Dactylocladus stenostachys Jongkong

22. Dillenia borneensis, Dillenia excelsa, Dillenia Simpoh (Peninsular)/Buan (Sarawak)
grandifolia, Dillenia pulchella, Dillenia reticulata


23. Dipterocarpus acutangulus, Dipterocarpus Keruing
applanatus, Dipterocarpus elongates, Dipterocarpus
baudii, Dipterocarpus caudiferus, Dipterocarpus
chartaceus, Dipterocarpus concavus, Dipterocarpus
cornutus, Dipterocarpus confertus, Dipterocarpus
conformis, Dipterocarpus costatus, Dipterocarpus
costulatus, Dipterocarpus crinitus, Dipterocarpus
dyeri, Dipterocarpus elongatus, Dipterocarpus
eurynchus, Dipterocarpus fagineus, Dipterocarpus
geniculatus, Dipterocarpus gracilis, Dipterocarpus
grandifl orus, Dipterocarpus hasseltii, Dipterocarpus
humeratus, Dipterocarpus kerrii, Dipterocarpus
kunstleri, Dipterocarpus lamellatus, Dipterocarpus
lowii, Dipterocarpus obtusifolius, Dipterocarpus
oblongifolius, Dipterocarpus ochraceus, Dipterocarpus
pachyphyllus, Dipterocarpus palembanicus,
Dipterocarpus pseudofagineus, Dipterocarpus
rigidus, Dipterocarpus rotundifolius, Dipterocarpus
sarawakensis, Dipterocarpus semivestitus,
Dipterocarpus sublamellatus, Dipterocarpus stellatus,
Dipterocarpus validus, Dipterocarpus verrucosus

24. Dryobalanops aromatica, Dryobalanops beccarii, Kapur
Dryobalanops fusca, Dryobalanops keithii,
Dryobalanops lanceolata, Dryobalanops oblongifolia,
Dryobalanops rappa

25. Duabanga moluccana, Duabanga grandiflora Magasawih/Sawih (Sarawak) Magas (Sabah)/Berembang bukit (Peninsular)/Tagahas (Sabah)

26. Durio carinatus, Durio grandifl orus, Durio graveolens, Durian
Durio lowianus, Durio malaccensis, Durio oxleyanus,
Durio singaporensis, Durio wyatt-smithii, Durio
zibethinus

27. Dyera costulata, Dyera polyphylla Jelutong

28. Endospermum diadenum, Sesenduk (Peninsular)/ Senduk-senduk mata/ Marapangi (Sabah)/Terbulan (Sarawak)
Endospermum peltatum

29. Eucalyptus deglupta, Eucalyptus grandis, Eucalyptus Eucalyptus
camadulensis, Eucalyptus pellita, Eucalyptus
tereticornis, Eucalyptus hybrids

30. Eusideroxylon zwageri Belian

31. Fagraea crenulata Malabera/ Malabira (Sabah)

32. Gigantochloa levis Buluh beting/Buluh poring
Gigantochloa ligulata Buluh tumpat
Bambusa blumeana Buluh duri
Dendrocalamus asper Buluh betong

33. Gmelina arborea Yemane

34. Gonystylus affi nis, Gonystylus bancanus, Gonystylus Ramin
brunnescens, Gonystylus confuses, Gonystylus
maingayi

35. Hevea brasiliensis Rubber/Getah (Timber-Latex Clones)

36. Heritiera albifl ora, Heritiera aurea, Heritiera Mengkulang/Dungun/Kembang (Sabah)
borneensis, Heritiera globosa, Heritiera javanica,
Heritiera littoralis, Heritiera simplicifolia, Heritiera
sumatrana

37. Hopea apiculata, Hopea auriculata, Hopea beccariana, Merawan/Selangan (Sabah)
Hopea bilitonensis, Hopea bracteata, Hopea coriaceae,
Hopea dryobalanoides, Hopea dyeri, Hopea ferrea,
Hopea ferruginea, Hopea glaucescens, Hopea griffi thii,
Hopea helferi, Hopea johorensis, Hopea mengarawan,
Hopea nervosa, Hopea nutans, Hopea odorata, Hopea
latifolia, Hopea pachycarpa, Hopea pedicellata, Hopea
pierrei, Hopea polyalthioides, Hopea pubescens, Hopea
sangal, Hopea semicuneata, Hopea subalata, Hopea
sublanceolata, Hopea sulcata

38. Ilex cissoidea, Ilex cymosa Mensirah (Peninsular)/ Kerdam (Sarawak)/Morogis (Sabah)

39. Intsia palembanica, Intsia bijuga Mer bau

40. Khaya ivorensis, Khaya
Khaya senegalensis

41. Kokoona littoralis, Kokoona ochracea, Kokoona ovata- Mata ulat (Peninsular)/Bajan (Sarawak)/Perupok Kuning (Sabah)
lanceolata, Kokoona reflexa

42. Koompassia malaccensis Kempas (Peninsular)/Menggaris (Sarawak) Tapang (Sarawak)
Koompassia maingay

43. Macaranga beccariana, Macaranga conifera, Mahang (Peninsular)/ Merkubong (Sarawak)/ Merkubong (Sabah)
Macaranga gigantea, Macaranga hosei, Macaranga
hypoleuca, Macaranga lowii, Macaranga pruinosa,
Macaranga tanarius, macaranga triloba, Macaranga
winkleri

44. Maesopsis eminii Maesopsis

45. Mallotus macrostachyus, Mallotus leucodermis, Balek angin, Mallotus dau/ Dahu (Sabah)
Mallotus miquelianus, Mallotus muticus, Mallotus
penangensis, Mallotus philippensis, Mallotus wrayi

46. Mangifera applanata, Mangifera caesa, Mangifera Machang (Peninsular)/ Embang (Sarawak) Beluno/ Bambangan/Mangga (Sabah)
foetida, Mangifera griffthii, Mangifera indica,
Mangifera longipetiolata, Mangifera laurina,
Mangifera odorata, Mangifera pajang, Mangifera
parvifl ora, Mangifera quadrifi da, Mangifera torquenda

47. Neobalanocarpus heimii Chengal

48. Neolamarckia cadamba, Anthocephalus chinensis. Kelempayan (Peninsular)/ Laran (Peninsular, Sabah)/ Selimpoh (Sarawak)

49. Octomeles sumatrana Binuang

50. Palaquium clarkeanum, Palaquium gutta, Palaquium Nyatoh
hexandrum, Palaquium hispidum, Palaquium
impressinervium, Palaquium maingayi, Palaquium
microphyllum, Palaquium obovatum, Palaquium
oxleyanum, Palaquium regina-montium, Palaquium
rostratum, Palaquium semaram, Palaquium
xanthochymum

51. Paraserianthes falcataria, Albizia falcataria, Albizia Batai/Kayu machis/Kungkur (Sabah)
chinensis, Albizia lebbek, Albizia acle, Albizia
pedicellata, Albizia procera

52. Parashorea densifl ora, Parashorea globosa, Urat mata/Gerutu
Parashorea stellata, Parashorea parvifolia, Parashorea
smythiesii

53. Parkia speciosa, Parkia singularis, Parkia timoriana Petai/Kupang (Sabah)

54. Pentace adenophora, Pentace curtisii, Pentace Melunak (Peninsular)/Baru (Sarawak)/Takalis (Sabah)
laxifl ora, Pentace macrophylla, Pentace triptera


55. Pentaspadon motleyi, Pentaspadon velutinus Pejon/Pelajau

56. Peronema canescens Sungkai

57. Pinus caribaea, Pinus insularis, Pinus merkusii, Pinus Pine
kesiya

58. Pithecellobium splendens Kungkur

59. Pterospermum diversifolium, Pterospermum jackianum, Bayor
Pterospermum subpeltatum

60. Pterocarpus dalbergioides, Pterocarpus indicus, Angsana/Sena/Narra
Pterocarpus macrocarpus, Pterocarpus marsupium,
Pterocarpus santalinus

61. Pterocymbium tinctorium, Pterocymbium javanicum Melembu/Teluto

62. Pterospermum javanicum Bayor Batu

63. Sandoricum beccarianum, Sandoricum koetjape Kelampu (Sarawak)/Sentul (Peninsular, Sabah)

64. Santiria apiculata, Santiria conferta, Santiria Kedondong (Peninsular)/ Seladah (Sarawak)
tomentosa


65. Scaphium linearicarpum, Scaphium longifl orum, Kembang semangkok
Scaphium macropodum, Scaphium scaphigerum

66. Schima wallichii Gegatal/ Gatal-gatal (Sabah)

67. Scorodocarpus borneensis Kulim (Peninsular)/Bawang hutan (Sabah)/Ungsunah (Sarawak)

68. Shorea acuminata, Shorea albida, Shorea almon, Meranti/ Seraya (Sabah)
Shorea andulensis, Shorea argentifolia, Shorea
assamica, Shorea bracteolata, Shorea dasyphylla,
Shorea fallax, Shorea henryana, Shorea hopeifolia,
Shorea hypochra, Shorea laxa, Shorea leprosula,
Shorea macroptera, Shorea myrionerva, Shorea
ochrophloia, Shorea ovalis, Shorea ovata, Shorea
parvifolia, Shorea parvistipulata, Shorea paucifl ora,
Shorea platyclados, Shorea polyandra, Shorea
quadrinervis, Shorea revolute, Shorea retusa, Shorea
roxburghii, Shorea rubra, Shorea rugosa, Shorea
scabrida, Shorea slootenii, Shorea smithiana, Shorea
talura, Shorea teysmanniana, Shorea waltonii

69. Shorea macrophylla Engkabang jantong
Shorea pinanga, Engkabang langgai bukit
Shorea palembanica Engkabang asu
Shorea splendida Engkabang bintang
Shorea macrantha Engkabang bungkus
Shorea hemsyleyana Engkabang gading
Shorea stenoptera, Engkabang rusa
Shorea seminis Engkabang terendak
and other Engkabang Kawang (Sabah) species

70. Sindora coriacea, Sindora echinocalyx, Sindora Sepetir (Peninsular)/Tampar hantu (Sarawak)
siamensis, Sindora velutina, Sindora wallichii

71. Swietenia macrophylla Mahogany

72. Tectona grandis Teak/Jati

73. Terminalia bellirica, Terminalia calamansanai, Talisai (Sabah)/ Jelawai/ Jaha (Semenanjung)/Kedandi (Sarawak)
Terminalia catappa, Terminalia citrina, Terminalia
copelandii, Terminalia foetidissima, Terminalia
phellocarpa, Terminalia subspathulata

74. Tetramerista glabra Punah (Peninsular)/Kayu hujan (Sarawak)/Tuyot (Sabah)

75. Toona calantas, Toona ciliata, Toona sinensis, Toona Surian/Limpaga/Red cedar
sureni

76. Vatica albiramis, Vatica bella, Vatica cinerea, Vatica Resak
cuspida, Vatica dulitensis, Vatica fl avida, Vatica
havilandii, Vatica heroptera, Vatica lowii, Vatica
maingayi, Vatica mangachapoi, Vatica maritima, Vatica
micrantha, Vatica nitens, vatica oblongifolia, Vatica
odorata, Vatica paucifl ora, Vatica rassak, Vatica
sarawakensis, Vatica scortechinii, Vatica venulosa


Made 23 November 2009

[CR (8.09)294/6/4-9 (SJ. 9) (2010); LHDN. 01/35/(S)/42/51/231-17.11;
PN(PU2)80/LVIII]

DATO’ SERI HAJI AHMAD HUSNI BIN MOHAMAD HANADZLAH
Second Minister of Finance

[To be laid before the Dewan Rakyat pursuant to subsection 154(2) Income
Tax Act 1967]