KUALA LUMPUR (Oct 18): The government has proposed to raise the windfall profit levy (WPL) threshold on crude palm oil (CPO) effective Jan 1 next year, said Prime Minister Datuk Seri Anwar Ibrahim.
The threshold to apply the 3% WPL is proposed to be increased to RM3,150 per tonne in Peninsular Malaysia and RM3,650 per tonne in Sabah and Sarawak, Anwar said when tabling Budget 2025 in the Dewan Rakyat on Friday.
This is an increase of RM150 per tonne from the current WPL threshold of RM3,000 per tonne in Peninsular Malaysia and RM3,500 per tonne in Sabah and Sarawak.
The WPL was reintroduced in 2008 with a 3% tax imposed on CPO prices when they hit the threshold. Smallholders are exempted from the levy.
The threshold stood at RM2,000 per tonne in 2008 but was raised in 2009 to RM2,500 per tonne for Peninsular Malaysia and RM3,000 per tonne for Sabah and Sarawak, and increased further in 2022 to the current level of RM3,000 per tonne in Peninsular Malaysia and RM3,500 per tonne in Sabah and Sarawak.
Meanwhile, the ceiling for the CPO export tax structure is also proposed to be raised starting Nov 1 this year. While it still starts at 3% for CPO in a RM2,250-RM2,400 per tonne range, the maximum tax rate has been increased.
Currently, the maximum tax rate is set at 8% when prices exceed RM3,450 a tonne.
Under the revised tax structure, the ceiling is proposed to be increased to 10% when prices exceed RM4,050 per tonne, additional brackets of 9.5% (RM3,901-RM4,050), 9% (RM3,751-RM3,900), 8.5% (RM3,601-RM3,750), and 8% (RM3,451-RM3,600) are to be introduced.
Among other initiatives to support the oil palm sector, Anwar said the Smallholder Oil Palm Replanting Financing Incentive Scheme (TSPKS) has been provided an unchanged allocation of RM100 million for 2025.
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