Malaysia: Substantial activity requirements, Labuan economic zone
Malaysia: Substantial activity requirements
The Labuan Financial Services Authority—the statutory body responsible for the development and administration of the Labuan International Business and Financial Centre (a special economic zone)—issued a circular (dated 29 April 2020) setting out revisions to the “substantial activity requirements” for eligibility as a Labuan international commodity trading company.
Labuan entities are allowed special tax benefits, and to be eligible, must comply with certain requirements (e.g., management and control).
The revisions in the circular are effective retroactively from 1 January 2019, subject to publication of these amendments in the official gazette and concerning the Labuan Business Activity Tax (Requirements for Labuan Business Activity) Regulations 2018.
Read a May 2020 report prepared by the KPMG member firm in Malaysia
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