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Revised export tax to make sector more competitive: Johari Ghani

KUALA LUMPUR: The revision of the palm oil export duty rate, effective from Nov 1 this year as outlined in the 2025 Budget, is not expected to affect the competitiveness of Malaysia's palm oil industry.

Plantation and Commodities Minister Datuk Seri Johari Abdul Ghani said the revision aims to encourage further processing and downstream activities in the palm oil industry, leading to the production of other value-added products.

"When we impose high taxes on crude palm oil (CPO) exports, it's actually to encourage more downstream activities. More value-added products will be produced in the country compared to exporting CPO," he told reporters after delivering his opening address at the Oils and Fats International Congress (OFIC) 2024 here today.

In the 2025 Budget appendix released by the Finance Ministry, the government proposed increasing the maximum export duty rate to 10 per cent for CPO priced above RM4,050 per tonne effective from Nov 1.

The new revision also indicated that an export duty of 8.5 per cent will be imposed on CPO priced between RM3,601 per tonne and RM3,750 per tonne, nine per cent for prices between RM3,751 per tonne and RM3,900 per tonne, and 9.5 per cent for prices between RM3,901 per tonne and RM4,050 per tonne. 

Currently, the CPO export duty structure starts at 3.0 per cent for prices between RM2,250 per tonne and RM2,400 per tonne, with a maximum rate set at 8.0 per cent for CPO prices exceeding RM3,450 per tonne. 

Regarding the government's proposal in the 2025 Budget to require all foreign workers to contribute to the Employees Provident Fund (EPF), Johari said it had not yet received any feedback from employers.

He added that it would be better to wait for the parliamentary debate on the proposal first.

"As for local workers, they are indeed contributing to the EPF. In the context of foreign workers, we have not yet received feedback from employers. I think we will wait for the parliamentary debate and see what feedback we get," he noted.

During the 2025 Budget presentation, Prime Minister Datuk Seri Anwar Ibrahim said the proposal to mandate all foreign workers to contribute to the EPF will be implemented in phases. 

He said the government is committed to providing fair treatment to all workers, regardless of nationality, in accordance with international standards.

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