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Question: (Import/Export Duty Exemption) Can a LMW/FIZ status company obtain import duty exemption on the sale of completed products to the Principal Customs Area (PCA)?

Answer: 1. Sales of consumer goods and intermediate goods that are produced in the Principal Customs Area (PCA) is subjected to an import duty at a rate equivalent to the CEPT rate
2. Sales of consumer goods and intermediate goods that are produced in the PCA, but with local materials valued exceeding 51% of and that the local materials were obtained from the Malaysian owned companies that are more than 51% are subject to import duty of 5% a.v. or the equivalent excise duty rate, whichever is higher (for products subjected to excise duty). For items with local content that do not exceed 51% but with at least 40%, relaxation may be considered based on the merits of the case
3. the sale of consumer goods not produced in the PCA are subjected to an import duty of 3% a.v.; and
4. the sale of intermediate goods that are not produced in the PCA are given full exemption from import duty or subjected to an import duty of 3% a.v. in accordance with applicable current policies on import duty exemption on raw materials/components and machinery/equipment for the manufacturing sector in the PCA.

Applications to pay the import duty under the CEPT rate, the company must fill out the PC (3) form in MIDA. Applications will be considered by the Treasury after receiving an assessment from MIDA. Applications to pay import duty on CEPT rate must be submitted directly to the Customs Department.

(Source: Official Portal of Ministry of Finance, 05 Feb 2025)

Source Link: https://www.mof.gov.my/portal/pdf/bahagian/tax/faq-en.pdf