A 30 Second Guide To MIDA Manufacturing License Exemptions
Manufacturers in Malaysia who don’t qualify for a MIDA Manufacturing License still need to register for a Manufacturing License Exemption Letter, also issued by MIDA.
For those who are unsure which they should apply for, this guide briefly explains:
- how to tell if you need a MIDA exemption letter
- implications of not qualifying for a Manufacturing License
- fees, validity periods, renewals, and
- submitting your Exemption Letter application
Note: Details can also be found on MIDA’s guide. Those who prefer official sources are welcome to read it–we’re still here to help you apply for it anyways!
Otherwise, let’s begin.
Do you need a Manufacturing License Exemption?
There are four requirements for a manufacturer to qualify for MIDA’s Manufacturing License.
- a Capital Investment Per Employee (CIPE) of at least RM140,000.00
- a workforce of minimum 80% Malaysian full-time employees
- either minimum shareholders’ funds of RM2.5 million or 75 full-time employees
- either at least 25% of the workforce consists of managerial, technical, and supervisory staff or a minimum value-added (VA) of 40%
Any manufacturer that doesn’t meet all four criteria should apply for an Exemption Letter.
Implications of a Manufacturing License exemption
There’s nothing to worry about if you don’t meet MIDA’s threshold for a Manufacturing License!
Even manufacturers with an exemption letter are eligible for many MIDA incentives including the two biggest ones:
- Pioneer Status: 70% – 100% income tax exemption for five – 10 years.
- Investment Tax Allowance (ITA): 60% – 100% allowance on certain capital expenses.
These incentives are granted for engaging in sectors deemed beneficial to Malaysia’s economy and it doesn’t matter whether a manufacturer has a full incense or an exemption.
Fees, wait times, validity periods, and renewals
Here are key application fees you should know:
| Application | Fee (RM) |
| Digital Certificate | 1,000 |
| Exemption of Manufacturing License | 1,000 |
| Additional Incentives (ex. ITA) | 2,500 |
A Digital Certificate is an electronic signature needed to submit applications to MIDA on their web portal, and each certificate is valid for two years.
The Manufacturing License Exemption Letter itself is valid for life unless there are major changes to company details, in which case a new application must be submitted.
If at this time the original Digital Certificate has expired, a new one must be obtained first.
For a full breakdown of all fees, here is MIDA’s official price list.
Submitting your application
MIDA only allows online applications and renewals done through their InvestMalaysia portal.
As it’s your first time using the platform, you’ll need to register a new account.
Then just follow this user guide which walks you through the application process step-by-step:
If all is well, an interim letter of approval will be issued within six to eight weeks.
You’ll be asked to provide some supporting documents and once done, the final Manufacturing License will be approved within seven to 60 days.
We wish you a smooth application, and just remember we’re here if you need help!
Let MISHU help with your MIDA exemption
If you have a better use of time than filling in forms and compiling documents, get in touch with us – we help businesses secure their MIDA licenses and incentives, and we’d be happy to help you.