Malaysia cuts tax to 5% for global services hubs in Budget 2027
- New Global Services Hub companies in Malaysia will pay a 5% tax rate from 2027.
- The incentive can be extended in five-year steps up to 30 years.
- Digital nomad pass holders can stay two more years after their limit.
- Spouses of some expatriates will be allowed to work in Malaysia.
KUALA LUMPUR, MALAYSIA — Malaysia is sharpening its pitch to multinationals that run regional service centers, offering a 5% tax rate on qualifying income and longer stays for remote workers in its 2027 budget. Prime Minister Anwar Ibrahim outlined six initiatives to make it easier for global companies to operate in the country and attract skilled talent.
A cheaper base for regional hubs
From January 2027, new companies under the Global Services Hub (GSH) incentive will pay a special 5% tax rate on income from hub activities, Malay Mail reported. Existing Principal Hub or GSH companies will get the same rate on income above their baseline, and the incentive can be extended in five-year steps up to 30 years.
GSH companies that manage treasury and fund activities will also be exempt from withholding tax on interest payments and stamp duty on intercompany loans. The scheme is run by the Malaysian Investment Development Authority (Mida). “Reformasi Madani has helped restore investor confidence, with Malaysia rising to 15th place in the World Competitiveness Index in two years,” Anwar told parliament.
Making it easier to bring talent
The budget also targets the people who staff those hubs. Holders of the DE Rantau Nomad Pass, Malaysia’s long-stay digital nomad visa, who have reached the two-year limit can stay and work remotely for two more years, subject to conditions.
From next year, spouses of expatriates on Category I Employment Passes and dependant passes will be allowed to work in Malaysia. “This is aimed at ensuring Malaysia remains an attractive destination for global talent without requiring their spouses to sacrifice their careers,” Anwar said.
A new Malaysian Asean Business Entity (MyABE) status will help Malaysian companies grow across Asean, and listed MyABE companies will get preliminary Employment Pass applications processed in a target of five working days. The government is also reviewing its Reinvestment Allowance and will work with Hong Kong regulators on dual listings.
For companies weighing where to put a regional global business services (GBS) or shared services center, a 5% rate and faster expatriate approvals put Malaysia firmly on the shortlist for regional hubs. Buyers can compare local delivery partners among the top BPO companies in Malaysia.
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