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New foreign worker levies for Peninsular Malaysia effective today

PUTRAJAYA: The new levies for foreign workers have been announced.

Effective Friday, employers in the manufacturing, construction and services sectors (category one) will have to pay a levy of RM1,850 for each foreign worker hired.

Plantations and agriculture sector bosses (category two) are to pay RM640 per worker.

Initially, the plan was to impose a levy of RM2,500 for each worker under category one, while employers in category two would have had to pay RM1,500 per worker.

Home Ministry secretary-general Datuk Seri Alwi Ibrahim (pic) in a statement on Friday said the decision on the new rates was made by the Cabinet last week.

He said the new rates entailed an increase of RM600 for category one and RM230 and RM50 for the plantations and agriculture sectors respectively.

The new rates are for Peninsular Malaysia only.

“We are confident that the rates are competitive and justified as foreigners who are working here also enjoy facilities, amenities and infrastructure provided by the Government,” he said.

“The Government believes the levy imposed is at an ‘optimum rate’ that will not affect the country’s economic growth, nor its plans to reduce dependency on labour intensive industries,” he added.

Prime Minister Datuk Seri Najib Tun Razak, in announcing the recalibration of Budget 2016 on Jan 28, had said that the levy for foreign workers would be restructured.

Deputy Prime Minister and Home Minister Datuk Seri Dr Ahmad Zahid Hamidi later revealed the new rates were to take effect on Feb 1 but were not implemented, as the decision had not been well received by certain industries and employers.

On Feb 16, the Home Ministry met with representatives from 28 groups and associations to hear their grouses.

foreign workers , levies , levy , home ministry