The Malaysian government is taking a strong stance on renewable energy targets, increasing the share of renewable energy in the electricity generation capacity mix to 70% by 2050; in line with Malaysia’s aspiration to be an inclusive, sustainable, and carbon-neutral nation by 2050. The Malaysian Investment Development Authority (MIDA) released updated guidelines for the Green Technology Incentives in October 2024.
The Green Technology incentive has been introduced since 2001 to encourage investments in green technology industries on a project basis, either for business purposes or own consumption, through the adoption of green technologies by selected services/service providers.
The government announced an extension and revision of the Green Technology Tax Incentive during the 2024 national budget which has been revised for applications submitted to MIDA and for qualifying assets purchased from 1 January 2024 to 31 December 2026.
The revision of Green Technology Tax Incentives provided tax incentives based on a tiering approach and categorised into three categories:
- Green Investment Tax Allowance (GITA) Project for Business Purposes;
- Green Income Tax Exemption (GITE) Solar Leasing; and
- Green Investment Tax Allowance (GITA) Asset for Own Consumption.
Based on the revision, the qualifying activities for the GITA Project for Business Purpose are expanded to cover new green technology projects, namely green hydrogen, electric vehicle charging stations, and renewable energy sources from wind energy.
GITA Project for Business Purpose and GITE Solar Leasing will be submitted to the MIDA. Meanwhile, GITA Asset for Own Consumption is to be forwarded to the Malaysian Green Technology and Climate Change Corporation (MGTC).
The main incentives outlined in the guidelines include:
Tax incentives under MIDA
Green Investment Tax Allowance (GITA) project for business purposes
| Qualifying Activities | Percentage of GITA | Percentage of
Statutory Income to be Set-Off |
Incentive Period |
| Tier 1:
1. Green Hydrogen |
100% | 100% or 70% | Up to 10
years (5+5) |
| Tier 2:
1. Integrated Waste Management (IWM) 2. Electric Vehicle (EV) Charging Station |
100% | 100% | 5 years |
| Tier 3:
Generation of energy from renewable sources: 1. Biomass 2. Biogas 3. Mini Hydro 4. Geothermal 6. Solar 7. Wind Energy |
100% | 70% | 5 years |
Green Income Tax Exemption (GITE) solar leasing
| Tier | Tax Exemption on
Statutory Income |
Incentive Period |
| Tier 1
>10MW – ≤30MW |
70% | 10 years |
| Tier 2
>3MW – ≤10MW |
5 years |
The guidelines outline details for each incentive, including eligibility conditions for previously approved companies, application mechanisms, and submission processes. Applications for the GITA Project for Business Purpose and GITE Solar Leasing should be submitted online to MIDA on their website.
