By Jennifer Chang
Substantial tax incentives have been proposed in Islamic finance during the recent Budget 2007 announcement. This is not surprising as the global market is experiencing an inflow of investors from the Middle East seeking modes of financing and investments, which not only provide similar returns compared to conventional financing and investments but are also in compliance with Islamic religious principles.
Such investors from the Middle East are eyeing Asia for investment potential, especially with the rise of economies such as China and India. As the demand for Islamic financing products grows globally, more and more countries are realising the potential of Islamic finance, which is likely to experience substantial growth worldwide.
Malaysia has many years of experience in Islamic banking, takaful (insurance) and capital markets. It is, therefore, appropriate for Malaysian players to capitalise on this market niche.
In seeking to promote Malaysia as an International Islamic Financial Centre (IIFC), tax incentives have been proposed to attract foreign Islamic finance players to establish themselves in Malaysia, grow the market as well as encourage Malaysian players to innovate and seek new markets to export their expertise. Read full article.
This article was first published in The Edge, 18 Sept 2006. Jennifer Chang is a Senior Executive Director at PricewaterhouseCoopers Taxation Services Sdn Bhd.
