INCOME TAX (ALLOWANCE FOR INCREASED EXPORTS) RULES 1999.
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 (Allowance for Increased Exports) Rules
1999.
(2) These Rules shall be
deemed to have come into operation on 1 January 1 998.
Interpretation
2. For the purposes of these
Rules-
"agricultural
produce" means fresh and dried fruits, fresh and dried flowers, ornamental
plants and ornamental fish;
"export"
means direct exports not including sales to Free Industrial Zones and Licensed
Manufacturing Warehouses;
"value
added" means the sale price of goods at ex-factory price less the total
cost of raw materials; and
"value
of increased export" means the difference of the Free-On-Board (FOB) value
of products exported in the basis period and that of the immediately preceding
basis period.
Allowance for increased exports
3. Subject to rules 4 and 5, where a manufacturing company or a
company engaged in agriculture, resident in Malaysia, exports manufactured
products or agricultural produce in the basis period for a year of assessment,
there shall be given to the company an allowance to be determined in the manner
as prescribed in rule 4:
Provided
that an exemption on exports manufactured products is only given to
manufacturer.
Determination of allowance
4. The allowance mentioned
in rule 3 refers to-
(a) 10 per cent of the
value of increased exports of manufactured products by the company where the
products exported attained at least 30 per cent of value added;
(b) 15 per cent of the
value of increased exports of manufactured products by the company where the
products exported attained at least 50 per cent of value added; and
(c) 10 per cent of the
value of increased exports of agricultural produce by the company.
Allowed amount exempt from tax
5. Where an allowance is given to a company under rule 3 for the
year of assessment, so much of the statutory income of that business of that
company for that year of assessment, as is equal to the amount of the allowance
(or to the aggregate amount of any such allowances as the case may be) but not
exceeding 70 per cent of the statutory income shall be exempt from tax.
Insufficiency of income
6. Where, by reason of the restriction of the allowance to 70 per
cent of the statutory income or of an insufficiency or absence of statutory
income from a business of the company for the basis period for a year of assessment,
effect cannot be given or cannot be given in full to any allowance or
allowances to which the company is entitled under rule 3 for that year of
assessment and so much of the allowance or allowances as cannot be given for
that year shall be given to the company for the first subsequent year of
assessment for the basis period for which there is statutory income from that
business, and for subsequent years of assessment until the company has received
the whole of the allowance or allowances to which it is so entitled.
Conditions to qualify for allowance
7. The exemption under rule 5 shall be granted subject to the
conditions as prescribed by the Minister.
Non-application
8.
These Rules shall not apply to a company-
(a) for the period during
which the company has been granted any incentives (except for deductions for
promotion of exports) under the Promotion of Investment Act 1986[Act 327];
(b) for the period during
which the company has been granted reinvestment allowance under Schedule 7A of
the Act.
Exclusion list
9. The exemption under rule 5 shall not apply to export of
products listed in the Schedule.
Application of paragraphs 5 and 6 of Schedule 7A
10. Paragraphs 5 and 6 of Schedule 7A to the Act shall apply
mutatis mutandis to the amount of income exempted under rule 5.
SCHEDULE
|
|
Description
|
Harmonized System Code
(H.S)
|
|
(i)
|
Tin ingots or slabs, tin ore and concentrates;
|
8001.00 000;
2609.00 000
|
|
(ii)
|
Natural rubber sheet and slabs, Standard Malaysian Rubber, crepe
natural rubber, natural rubber latex and natural gums;
|
4001.10; 4001.21;
4001.22; 4001.29;
4001.30
|
|
(iii)
|
Crude palm kernel oil, palm kernel cakes and crude palm oil;
|
1511.10 000;
1513.21 100;
2306.60 200
|
|
(iv)
|
Copra, copra cakes and crude coconut oil;
|
1203.00 000;
1513.11 000;
2306.50 000
|
|
(v)
|
Logs, sawn timber (ungraded and non-kiln dry) and wood chips
(except briquettes);
|
44.08; 44.07;
44.01; 44.30
|
|
(vi)
|
Petroleum oils (crude and other than crude) and petroleum gases
and other gaseous hydrocarbons (liquified or in gaseous state) hydrogen,
nitrogen and oxygen.
|
2709.00; 2710.00;
27.11;27.12;27.13;
2804.10 000;
2804.30 000;
2804.40 000
|
Made
2 April 1999.
[Perb.
0.3865/75 (SJ. 45); LHDN. 01/35/(S)/42/51/82-10.1; PN(PU2)80/XXVI]
DATO' MUSTAPA BIN
MOHAMED
Second Minister of
Finance
[To be laid before the Dewan Rakyat pursuant to subsection 154(2)
of the Income Tax Act 1967]
