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Expat News – November 2011

In recognition of the Malaysian Government’s plans to attract more foreigners to Malaysia and liberalise the rules on visas and work permits, we are introducing this news section to keep resident and prospective expats updated on news affecting them working or living here.

The 2012 Budget

This year’s Budget which was announced in September will not have a major impact on most expats.

In his budget speech, the Prime Minister recorded the huge surge in foreign direct investment over the last two years. FDI for the first half of 2011 was RM21.2 billion, up 75% from the first half of 2010. He predicted the Malaysian economy will grow between 5% and 6% next year.

This 2012 Budget is focused on improving conditions for the lower income Malaysians. The corporate and personal tax cuts which some people had hoped would be announced did not materialise.

On the other side the usual increases in the “sin tax” on alcohol and cigarettes were also omitted from this year’s budget.

Expats who contribute to the Employee Provident fund (EPF) and wanted to withdraw funds to buy a house have been told that this was only available to Malaysians.

In the Budget speech, the Prime Minister announced this is changed and expats can now also withdraw money to purchase a house. It should be noted that, unlike Malaysians, it is not compulsory for expats to contribute to EPF.

The real estate capital gains which is 5% for anyone selling within five years of purchase is now increased to 10% but only if you sell within two years.

The 5% rate will continue to apply for people selling in the third year through to the fifth year. Sales after 5 years of ownership are free of any tax.

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Futsal Gets A Boost

One interesting fact revealed in the budget is that the Government has built 1100 Futsal courts around Malaysia and another 527 are currently under construction.

For those not familiar with the sport, Futsal is an indoor version of association football, played by teams of five players. It’s also a little more suited to the Malaysian climate.

The Government has allocated an additional RM15 million to build another 150 courts. If you haven’t seen a Futsal court as you travel around Malaysia, you haven’t been looking.

New ID Cards For Working Expats Now Available But….

The recent announcement that all working expats would once again receive ID cards, now called the IPass, was enthusiastically received by many expats.

Apparently there were problems with the old ID cards not being compatible with the Immigration’s computer software.

The local press quoted the Minister as saying that expats should go to the Immigration Department to collect the IPasses.

However, we have since learned this is not correct. The new IPasses are only being given to expats who apply for a work permit or are having it renewed.

As most people know it is not easy for individuals to get information from the Immigration Department and we often experience the same problem. The first person my staff spoke with confirmed that all expats would get the new IPass, but when we actually went to their offices we were told that was incorrect. At this time we understand that is still the case. Watch this space!

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Repeal  Of ISA And Media Freedom Welcomed

The Prime Minister’s surprise announcement that he would repeal the Internal Security Act (ISA) was well received by Malaysians and the international community.

The ISA which was introduced by the British during the communist insurgency, was never repealed, and has come under much international criticism as it allows people to be detained for up to two years without trial. Many people claim it has been used inappropriately to prevent political dissent.

Criticism from Western countries reduced considerably after some of them implemented similar strict regulations, after 9/11, to use against suspected terrorists.

However, many people in Malaysia have asked for it to be repealed. It will apparently be replaced by laws which set stricter criteria for imprisoning people without trial and give more authority to the judiciary in these cases.

In addition, the decision to allow more freedom of the press by changing the rather restrictive Printing Press and Publication Act was also welcomed as an important step toward press freedom. Malaysian currently ranks 141 out of 178 in terms of press freedom according to Reporters Without Borders. It remains to be seen exactly what the new regulations, which replace these laws, look like but it is certainly a step in the right direction.

Source: The Expat November 2011
This article has been edited for ExpatGomalaysia.com
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