SHAH ALAM, Oct 28 — Manufacturing companies seeking licences and tax incentives must ensure that at least 80 per cent of their full-time workforce comprises Malaysian citizens, subject to the implementation of the Multi-Tier Levy Mechanism (MTLM).
Investment, Trade and Industry Minister Datuk Seri Johari Abdul Ghani said the requirement was part of efforts to prioritise local employment and ensure approved investments generated greater economic benefits, particularly through higher-paying jobs, increased productivity and technology transfer.
According to Johari, the New Incentive Framework (NIF), implemented for the manufacturing sector on March 1, 2026, shifts investment assessments from a product- and activity-based approach to one focused on economic outcomes.
"In creating quality jobs, the emphasis is no longer solely on the number of jobs created but also on income levels, skills and career development opportunities for Malaysians.
"Key indicators assessed include the percentage of highly skilled workers, employees' median annual salary, the percentage of employees earning more than RM10,000 a month and the percentage of Malaysians holding managerial, technical and supervisory positions."
He said this in a parliamentary reply yesterday in response to Bachok MP Mohd Syahir Che Sulaiman, who had asked about reforms to investment application assessments aimed at ensuring the creation of quality jobs.
Johari said approvals for manufacturing licences and tax incentives were also subject to several other criteria, including having at least 25 per cent of employees in managerial, technical and supervisory (MTS) positions or achieving a minimum value-added output of 40 per cent, as well as a capital investment ratio of at least RM140,000 per employee.
"Investors must also establish partnerships with local vendors, provide internship programmes and collaborate with local universities and research institutions."
He said qualifying investors could receive special tax rates ranging from zero to 10 per cent for up to 10 years, or investment tax allowances of up to 100 per cent on eligible capital expenditure for up to 10 years.
The special tax rate period could be extended to 15 years for less-developed areas and small companies, depending on their assessment scores.
"The expansion and reform of tax incentive assessments through the NIF ensure that every tax exemption granted by the government generates optimal returns for the country through technology transfer, the empowerment of local micro, small and medium enterprises (MSMEs), and the creation of high-income jobs for Malaysians."
He said the implementation of the NIF for the services sector was being finalised.
