PERMAI Stimulus Package

Following the implementation of Movement Control Order ["MCO"] 2.0, the Government has introduced the Perlindungan Ekonomi and Rakyat Malaysia ["PERMAI"] Stimulus Package value at RM15 million on 18th January 2021. The objectives of PERMAI Stimulus Package are to:-

combat the COVID-19 outbreak;
safeguard the welfare of the Rakyat; and
support the business continuity.

Some salient points of the abovementioned stimulus package are:-

1. Expansion of Scope for Medical Examination
Under the Budget 2021 announcement, the relief on the expenses incurred on complete medical examination was increased from RM500 to RM1,000
It is announced that the scope of medical examination be expanded to include COVID-19 screening
Effective year of assessment ["YA"] 2021
2. Extension of Special Tax Relief in Relating to the Purchase of Personal Computer, Smartphone or Tablet
Under the Short-Term Economic Recovery Plan ["PENJANA"], a special personal relief up to RM2,500 (which is in addition to the current lifestyle relief) was given for the purchase of personal computer, smartphone or tablet where the purchase is made during the period from 1st June 2020 to 31st December 2020
It is announced that the above special personal relief be extended for another year i.e. until 31st December 2021
Applicable to YA 2020 and YA 2021
3. Extension of Sales Tax Exemption on Passenger Vehicles
Under PENJANA, sales tax on locally assembled cars is fully exempted and 50% sales tax exemption was granted for imported cars from 15th June 2020 until 31st December 2020
As announced by the Ministry of Finance via media release on 29th December 2020 earlier, the above sales tax exemption be extended to 30th June 2021
4. Wage Subsidy Program 3.0
The Wage Subsidy Program ["WSP"] was first introduced under the Prihatin Economic Stimulus Package to provide financial assistance to employers for local employees earning RM4,000 or less
Under Budget 2021, the WSP is further extended with a more targeted approach specifically for the tourism sector, which includes the retail sector at a rate of RM600 per month for workers earning RM4,000 or less. The limit of 200 eligible employees has also been increased to 500 eligible employees
It is announced that all employers operating in MCO states will be eligible to apply, irrespective of sector, under this WSP 3.0. For a period of 1 month, eligible employers will receive a wage subsidy of RM600 for each of their employers earning RM4,000 or less, up to a maximum 500 employees
5. Extension of Special Deduction on Rental
A special deduction is granted to landlords offering reduction of rental on business premises to tenants who are Small and Medium Enterprises ["SME"] (as defined under the SME Corporation) of at least 30% from the original rental rate from 1st April 2020 to 31st March 2021
It is announced that the above be expanded to include rental reduction given to non-SMEs tenants and the eligible period be extended to 30th June 2021
6. Reduction of Ownership Period Eligible for Excise Duty and Sales Tax Exemption for Transfer, Disposal and for Private Use of Taxis
Currently, exemption from excise duty and sales tax for the purpose of transfer, disposal and for private use of taxis are given to a licensed taxi driver who owns a taxi for a minimum period of 7 years
It is announced that the minimum ownership period to be eligible for the above exemption be shortened to 5 years
7. HRDF Levy Exemption
It is announced that exemption from payment of Human Resource Development Fund ["HRDF"] levy be granted to companies that are unable to operate during the MCO and Conditional MCO periods
8. Relaxation on the Eligibility of Employment Insurance System
Currently, the following employees are covered under the Employment Insurance System Act:-
Malaysian citizen / permanent residents
aged 18 to 60;
working in the private sector; and
employed based on a contract of service
Employees who are retrenched or have loss of income are eligible for financial assistance of up to 6 months, subject to the following conditions:-
application be made within 60 days after their loss of employment;
meet the contribution qualifying conditions as set by SOCSO; and
being unemployed under the definition of loss of employment as defined by SOCSO
It is announced that employees who do not meet the minimum contribution conditions, or whose contract was not extended after having been renewed for at least 3 times previously, will be eligible to apply for the financial assistance of 30% of their monthly salary for a period of 3 months

For further information, kindly refer to the text of the speech for the PERMAI Stimulus Package.

Please do not hesitate to contact us if you need any clarification on the foregoing.