Finance Act 2015, Chapter VII — AMENDMENTS TO THE PROMOTION OF INVESTMENTS ACT 1986 (s 57–s 59) — Laws of Malaysia

Commencement of amendments to the Promotion of Investments

s 57

This Chapter has effect for the year of assessment 2015 and subsequent years of assessment.

Amendment of section 2

Section 2 of the Promotion of Investments Act 1986, which is referred to as the “principal Act” in this Chapter, is amended— (a) by inserting after the definition of “industrial linkage programme” the following definition: ‘ “input tax” has the meaning assigned to it in the Goods and Services Tax Act 2014 [Act 762];’; and (b) by inserting after the definition of “Minister” the following definition: ‘ “output tax” has the meaning assigned to it in the Goods and Services Tax Act 2014;’.

New sections 29q and 29r

s 59

The principal Act is amended by inserting after section 29p the following sections: “Determination of capital expenditure in respect of promoted activity or promoted product subject to goods and services tax for investment tax allowance 29q. Where a company which has been granted approval under section 27, 27a, 27c, 27d, 27e, 27f, 27g, 27i, 27j, 27k, 27m or 27n has incurred in the basis period for a year of assessment capital expenditure in respect of promoted activity or promoted product for the period specified under paragraph 29(2)(b), (c) or (d), paragraph 29a(3)(b), (c) or (d), paragraph 29aa(3)(b), 29b(2)(b), 29d(2)(b), 29e(2)(b), 29f(2)(b), 29g(2)(b), 29h(2)(b), 29j(2)(b), 29k(2)(b), subparagraph 29l(2)(a)(ii), 29l(3)(a)(ii), 29l(4)(a)(ii), 29l(5)(a)(ii), 29l(6)(a)(ii), paragraph 29n(3)(b) or 29o(3)(b), the capital expenditure incurred by the company shall not include any amount paid or to be paid in respect of goods and services tax by that company if the company is liable to be registered under the Goods and Services Tax Act 2014 and has failed to do so, or if the company is entitled to credit that amount as input tax under that Act. Adjustment of capital expenditure incurred which is subject to goods and services tax 29r. (1) Where in the basis period for a year of assessment a company has incurred capital expenditure under this Act and such capital expenditure is subject to any adjustment made in respect of input tax for a period specified under the Goods and Services Tax Act 2014, the amount of such expenditure for that asset shall be adjusted in the basis period for the year of assessment in which the period of adjustment relating to the asset as provided under the Goods and Services Tax Act 2014 ends. (2) In the event the adjustment of the amount of the capital expenditure made under subsection (1) results in— (a) an additional amount, such amount shall be deemed to be part of the capital expenditure incurred for the purpose of this Act, and subject to sections 29, 29a, 29b, 29d, 29e, 29f, 29g, 29h, 29j, 29k, 29l and 29o, there shall be given to the company for a year of assessment an allowance in respect of such additional amount; or (b) a reduced amount, any amount of allowance that ought not to have been given under this Act in consequence of such reduction shall be part of the statutory income of that company from a source consisting of a business in the basis period the adjustment is made. (3) Notwithstanding subsection (1), where a company has incurred capital expenditure in relation to an asset, and the asset is disposed of at any time in the period of adjustment specified under the Goods and Services Tax Act 2014, the adjustment to such expenditure shall be made in the basis period for the year of assessment in which the disposal is made. (4) Where an adjustment is made in respect of the input tax under the Goods and Services Tax Act 2014, the Director General may make a computation or recomputation of any allowance made under this Act or the amount of statutory income of a company for a year of assessment in the similar manner as provided under this section, in the basis period for the year of assessment the adjustment is made or at any time as may be necessary to give effect to such adjustment.”. DICETAK OLEH PERCETAKAN NASIONAL MALAYSIA BERHAD, KUALA LUMPUR BAGI PIHAK DAN DENGAN PERINTAH KERAJAAN MALAYSIA

Finance Act 2015 Chapter VII — AMENDMENTS TO THE PROMOTION OF INVESTMENTS ACT 1986

s 57

s 58

s 59

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