Qualifying Criterias for MITC
To qualify as an approved MITC, the company must apply to the Malaysia External Trade Development Corporation (MATRADE) and satisfy the following conditions:-

• must be locally incorporated;
• equity holding of at least 60% Malaysian;
• achieve an annual sales turnover of more than RM10 million;
• export manufactured goods, especially those from Malaysian small and medium scale companies. (This refers to companies with annual sales of <RM25 million and <150 full time employees);

Application to be registered as an MITC can be made using the form (MITC: 1/2002) which is available free of change at MATRADE. Two (2) copies of duly completed form must be submitted to MATRADE at the address below.

Eligibility and Certification for Tax Incentive
An approved MITC can apply for the tax exemption to the Inland Revenue Board amounting to 10% of the increase in the value of export upon fullfilling the following conditions:-

• not more than 20% of the company's annual sales is derived from trading in commodities. Commodities refer to the items listed in Annex 1;
• company uses local services for export such as banking, finance, insurance, local ports and airports.

For purpose of claiming the tax incentive:-

• Export sales refer to the FOB value of goods sold.
• Goods (locally produced or manufactured or imported for subsequent re-exports) are regarded as exports when they are taken out of the country.
• Sales to LMW and FTZ are not deemed to be considered export for the purpose of this incentive.
• Export Sales do not include trading commissions and profits derived from trading at the Commodity Exchange.
  

The tax incentive will be effective from the year of assessment 2002. Companies with no export sales in the preceding year cannot apply for the tax exemption. Tax exemption will be granted for 5 consecutive years of assessment to each company provided all conditions are fullfilled commencing from the year of assessment the company is first given the incentive.

A claim for the incentive must be made in the annual tax return to the Inland Revenue Board and attached together a letter from MATRADE certifying that the company has complied with the conditions of the incentive. Application for certification can be made using the application form (MITC: 2/2002) which is available free of charge at MATRADE. Two (2) copies of duly completed forms must be submitted to MATRADE.

For further clarifications please contact MATRADE at :

Trade Advisory Services Unit
Tingkat 2, Menara MATRADE,
Jalan Khidmat Usaha,
Off Jalan Duta,
50480 Kuala Lumpur.

Tel: (603) 6207 7077 ext 7637
Fax: (603) 6203 7253
Email: info@matrade.gov.my

ANNEX 1

Pepper and Pepper Products
HS 0904.1.xxx Pepper Neither Crushed Nor Ground

Cocoa and Cocoa Products
HS 1801.00.000 Crude Beans, Whole or Broken, Raw or Roasted
HS 1802.00.000 Cocoa Shells, Husks, Skins and Other Cocoa Waste

Palm Oil and Products
HS 1511.10.000 Crude Palm Oil
HS 1513.21.100 Crude Palm Kernel Oil
HS 2306.60.000 Oil Cakes and Other Solid Residues of Palm Nuts or Kernels

Tobacco and Tobacco Products
HS 2401.xx.xxx Unmanufactured Tobacco

Rubber and Products
HS 4001.10.xxx Natural Rubber Latex
HS 4001.21.xxx Natural Rubber in other Forms
HS 4001.22.xxx Technically Specified Natural Rubber
HS 4001.29.xxx Others
HS 4003.00.xxx Reclaimed Rubber in Primary Forms
HS 4004.00.xxx Waste, Parings and Scraps of Rubber

Forestry Products
HS 1401.10.000 Bamboos
HS 1401.20.xxx Rattan
HS 4401.xx.xxx Fuel Woods in Logs, in Billets, in Twings, in Faggots or in Similar Forms
HS 4402.xx.xxx Wood Charcoal
HS 4403.00.xxx Wood in the Rough, Whether or not stripped of Bark of Sapwood or Roughly Squared

Minerals and Mineral Products

(a) All Minerals and Mineral Products Under HS 25xx.xx.xxx

Except for Items:
HS 2522.10.000 Quicklime
HS 2522.20.000 Slaked Lime
HS 2522.30.000 Hydraulic Lime
HS 2523.10.000 Cement Clinkers
HS 2523.21.000 White Cement
HS 2523.29.100 Coloured Cement
HS 2523.29.900 Other
HS 2523.30.000 Aluminous Cement
HS 2523.90.000 Other Hydraulic Cements

(b) All Ores, Slag and Ash Under HS 26xx.xx.xxx
(c) All Minerals Fuels, Mineral Oils and Products Under HS 27xx.xx.xxx