Malaysia has announced several significant immigration and investment measures as part of Budget 2027, aimed at strengthening the country’s position as a destination for global talent, remote workers, and multinational businesses.
Spouses of Category I Employment Pass Holders to Be Allowed to Work
Effective January 1, 2027, spouses of expatriates holding a Category I Employment Pass will be permitted to work in Malaysia, subject to applicable conditions and requirements.
The new policy applies to spouses who hold a Dependant Pass.
According to Prime Minister Anwar Ibrahim, the initiative is intended to make Malaysia more attractive to highly skilled foreign professionals by allowing accompanying spouses to continue pursuing their careers instead of leaving the workforce.
Additional Flexibility for Digital Nomads
The government also announced an extension for certain remote workers currently residing in Malaysia under the country’s digital nomad framework.
Professionals holding a Professional Visit Pass (Nomad category) who have reached the current two-year limit will be eligible for an additional two-year extension, subject to compliance with program requirements and applicable conditions.
The measure is expected to benefit remote workers and location-independent professionals who wish to continue living and working remotely from Malaysia.
Enhanced Incentives for Global Services Hubs
Malaysia will also strengthen incentives under its Global Services Hub (GSH) Scheme beginning January 1, 2027.
New Companies: New qualifying GSH companies will be eligible for a special corporate tax rate of 5% on income derived from eligible GSH activities.
Existing Companies: Existing GSH participants will also qualify for a 5% tax rate on income exceeding a prescribed baseline threshold.
Extended Incentive Period: The government will allow incentive periods to be extended in five-year increments, with a maximum incentive period of 30 years.
Additional Tax Relief for Treasury and Fund Management Activities
Companies engaged in treasury and fund management operations through the GSH framework will receive further benefits, including:
- Exemption from withholding tax on qualifying interest payments; and
- Exemption from stamp duty on intercompany loan agreements.
These measures are designed to support regional treasury centers and financial operations located in Malaysia.
Incentives Also Apply to the Johor-Singapore Special Economic Zone
The government confirmed that the enhanced GSH incentives will also apply to relevant qualifying activities within the Johor-Singapore Special Economic Zone (JS-SEZ).
The extension of these incentives forms part of Malaysia’s broader strategy to attract foreign investment, regional headquarters operations, and highly skilled talent to the country.
Erickson Insights & Analysis
Erickson Immigration Group will continue to monitor developments and share updates as more news becomes available. Please contact your employer or EIG attorney if you have questions about anything we’re reporting above or if you have case-specific questions.