The Malaysia Semiconductor Industry Association (MSIA) wants targeted tax relief for engineers, especially those in design and development (D&D), smart manufacturing and advanced equipment to be included in the 2026 federal budget.
MSIA president Wong Siew Hai said this would encourage and retain talents in Malaysia, Bernama reported.
He added that education was also key and proposed special government funding to improve science, technology, engineering, and mathematics (STEM) and artificial intelligence (AI) education in schools and universities.
“We need to encourage more students to pursue STEM studies, and to strengthen the talent pipeline by providing tax relief and incentives for parents of students pursuing STEM,” he said.
He added that it was necessary to ensure resources are not spread too thin and are better utilised to support the industry.
In the meantime, Wong suggested the government allow the use of foreign STEM graduates and global expertise to fill immediate gaps and support Malaysia’s pursuit of advanced design and development for greater innovation success.
On a separate note, Wong said MSIA is seeking relief on stamp duty, including exemptions for employment and intercompany contracts, deferments and clearer guidelines as part of its wishlist for the 2026 federal budget.
Wong also called for sales and service tax (SST) relief through broader business-to-business exemptions, support for capital-intensive industries, and investment-linked incentives for energy efficiency and automation, Bernama reported.
He said these and the introduction of a qualified refundable tax credit to offset the impact of the global minimum tax and grants for supply chain resilience would also help sustain Malaysia’s investment competitiveness.
“MSIA also hopes that the government will introduce policies to diversify export markets and fund key initiatives that support the ‘Made by Malaysia’ agenda.
“Budget 2026 is a golden opportunity for Malaysia to move from ‘Made in Malaysia’ to ‘Made by Malaysia’,” he told Bernama.
“By delivering targeted cost relief, talent incentives, and stronger support for research, development, commercialisation, and innovation, we can accelerate the implementation of the national semiconductor strategy and secure Malaysia’s place as a global semiconductor powerhouse.”
Prime Minister Anwar Ibrahim, who is also the finance minister, is scheduled to table the 2026 feberal budget in the Dewan Rakyat on Oct 10.
