KUALA LUMPUR — Following the announcement by the Ministry of Investment, Trade and Industry (MITI) on 29 January 2026, the Malaysian Investment Development Authority (MIDA) is ready to operationalise the New Incentive Framework (NIF) from 1 March 2026, marking a shift towards an outcome-based, value-driven investment approach in Malaysia.
The framework will first apply to the manufacturing sector, followed by the services sector in the second quarter of 2026. The NIF ties tax incentives directly to measurable economic outcomes, with companies assessed using the National Investment Aspirations (NIA) Scorecard, which quantifies contributions to job quality, technology transfer, supply chain resilience and sustainability.
MIDA Chairman Tengku Datuk Seri Zafrul Tengku Abdul Aziz said the framework is premised on the fundamental principle of returns on government incentive investment.
“The NIF is designed to ensure that every ringgit of foregone revenue delivers meaningful, multiplied returns to the nation’s economy. Our priority is not merely to attract investments, but to secure greater value, deeper industrial linkages and better benefits for the Malaysian economy, SMEs and our people,” he said.
In terms of implementation, incentive applications for the manufacturing sector under the Promotion of Investments Act 1986 will continue to be accepted by MIDA until 3.00pm on 28 February 2026. All new manufacturing incentive applications submitted from 1 March 2026 onwards will be assessed under the NIF. Manufacturing companies with existing approvals will not be affected, and their incentives will continue under the approved terms and conditions.
MIDA Chief Executive Officer Datuk Sikh Shamsul Ibrahim Sikh Abdul Majid said the authority fully supports the NIF, describing it as a major step forward in attracting the right type of investments.
“Those that are high-value, innovation-driven and sustainable. By linking incentives to clear performance outcomes, the NIF strengthens investor confidence while delivering spillover benefits to the domestic economy, especially for local SMEs and Malaysian talent,” he said.
The framework offers two mutually exclusive incentive options: a special tax rate or an investment tax allowance. Companies may choose the option that best suits their project profile and business model.
MIDA will actively guide investors through the transition from the previous incentive regime to the NIF. The application process will be integrated into MIDA’s digital platforms, providing end-to-end processing for investors. Implementation guidelines and frequently asked questions covering eligibility criteria, scorecard assessment parameters and evaluation processes are now available on MIDA’s official website and MITI’s NIF microsite.
“We look forward to working closely with investors throughout this transition. MIDA remains committed to facilitating and supporting both new and existing investors to ensure projects approved under the NIF deliver strong national outcomes in line with the NIA,” Datuk Sikh Shamsul Ibrahim added.
MIDA will also intensify engagement and outreach sessions to ensure awareness and readiness among domestic and foreign investors, particularly in the manufacturing and services sectors. The rollout will be supported through close collaboration with MITI and the Ministry of Finance.
The NIF represents Malaysia’s most significant shift in investment policy in decades. For further information and application guidance, investors may refer to the NIF Implementation Guidelines on MIDA’s official website at www.mida.gov.my.
(Bernama)
