Malaysia said on Friday its federal government plans to adopt electric vehicles (EV) as official vehicles as national utility firm Tenaga Nasional Bhd (TNB), Gentari and Tesla invest over MYR170 million ($35.96 million) to establish EV charging stations.

This is one of the several EV-centric initiatives announced in the Budget 2024.

Government will also extend up to MYR2,500 ($528.73) income tax relief for EV charging facility expenses for a period of four years, and tax deduction for EV rental cost for two years, Prime Minister Anwar Ibrahim announced on Friday.

In his budget speech to parliament, he said the country’s public transport operator Prasarana Malaysia Bhd will acquire 150 electric buses and build three bus depots at a cost of MYR600 million ($126.9 million).

Besides, Anwar said the government will provide up to MYR2,400 ($507.59) rebate for the purchase of electric bikes to buyers with annual income below MYR120,000 ($25,379) under its Electric Motorcycle Use Promotion Scheme.

These announcements also comes amid the Malaysian government continues its effort to develop the country’s EV sector to become an EV powerhouse in the region or a hub in the global production and supply chain of EVs.

On a separate matter, the government will also strengthen the venture capital environment through the centralization of venture capital agencies such as Penjana Kapital and Malaysia Venture Capital Management Bhd (MAVCAP) under the sovereign wealth fund Khazanah Nasional Berhad.

Malaysia also said it would introduce a capital gains tax and a tax on high-value goods and gradually cut subsidies.

Malaysia’s economy is expected to sustain economic growth of 4 percent to 5 percent in 2024 while the GDP growth for the year 2023 is projected at approximately 4 percent.

Several other tech and investment-related announcements include:

​​- Putrajaya to serve as Malaysia’s low carbon city model, with govt buildings set to have solar panels installed in partnership with TNB and Gentari.

– To stimulate companies to invest in high-growth and high-value areas (HGHV), govt plans to provide a tiered reinvestment tax incentive in the form of an investment tax allowance of 70 percent to 100 percent

– Government-linked companies and government-linked investment companies (GLICs) will provide funds of up to MYR1.5 billion to encourage startups including Bumiputera SME entrepreneurs to venture into high growth and high value (HGHV) fields such as the digital economy, space technology and electronics and electrical

– Government to allocate MYR28 million to develop the MYStartup platform as a single window for start-ups. This initiative will optimize MYR200 million fund under various funding agencies and venture capital under a single platform.

– To build a wider ecosystem for the E&E cluster in the northern region, the government will open a high-tech industrial area in Kerian, North of Perak state

To support capital funding for startups:

– First: allocation of MYR100 million to Malaysia Co-investment Fund (MyCIF) for a period of three years to complete the cooperation with food security initiatives, environment, the community and the State Islamic Religious Council to create opportunities for developing waqf assets for health, education and agro-based enterprises.

– Second: tax incentives for individual investors investing in startups through the equity crowdfunding platform (ECF) will also be extended to individual investors through limited liability partnership 40 nominee companies and extended until Dec 31, 2026.

– Third: tax incentive for angel investors extended until Dec 31, 2026 to encourage capital in technology related startups.

Malaysia’s Science ministry proposes initiatives to enhance startup ecosystem, STEM education to be included in Budget 2024