Foreign source income tax exemption to reduce companies' earnings risk

KUALA LUMPUR: CGS-CIMB is taking a positive view of the tax exemption on foreign-sourced dividends for corporates as it would reduce the earnings risks for companies with large overseas investments.

In a note, the firm said that it had been concerned about the government’s earlier decision to withdraw the tax exemption on foreign source income (FSI) for corporates in Budget 2022, as the change will permanently affect future income streams from overseas investments.