Kuala Lumpur:The extension of income tax exemptions and the introduction of fixed stamp duty rates on ship financing under Budget 2027 are set to alleviate financial constraints for Malaysian shipowners. These measures are particularly significant for those facing stringent collateral requirements and mismatches between loan tenures and the useful lives of their ships.
According to BERNAMA News Agency, Prime Minister and Finance Minister Datuk Seri Anwar Ibrahim revealed the extension of a full income tax exemption for Malaysian shipping companies until the year of assessment 2036 during the tabling of Budget 2027. Additionally, the government has set fixed stamp duty rates on loans for purchasing or constructing Malaysian vessels, with RM2,000 for loans up to RM100 million and RM5,000 for loans exceeding that amount.
Maritime analyst Nazery Khalid stated that these incentives could reduce ship financing costs, especially for locally built vessels, while fostering the growth of domestic shipping capacity. He noted that the measures would support sectors such as energy, bulk commodities, and container shipping, aligning with Malaysia's expanding trade volumes and economic growth.
Nazery also highlighted that the incentives could decrease Malaysia's dependency on foreign vessels and curtail foreign exchange outflows. Furthermore, they address long-standing requests from local shipowners for improved financing conditions. These initiatives may assist smaller shipping companies in accelerating digitalisation to remain competitive amidst geopolitical uncertainties and shifts in global supply chains.
In addition to financial relief, the incentives encourage investment in modern, environmentally friendly vessels to meet the International Maritime Organisation's requirements for reducing greenhouse gas emissions, supporting the country's net-zero goals.
Nazery emphasized the importance of addressing the shortage of training berths for cadets from Malaysian maritime academies. He suggested that the government consider linking financing access from institutions like Bank Pembangunan Malaysia Bhd and EXIM Bank to the provision of training berths. While acknowledging that this decision lies with shipping companies, he noted that such a measure would greatly benefit maritime academies and cadets, encouraging more young Malaysians to pursue maritime careers.