Malaysia on Friday said it will offer a zero per cent tax rate to entice Asia’s rich to set up family offices in the Forest City Special Financial Zone (SFZ), as the government finally outlines its incentives to attract foreign capital to the troubled multibillion-dollar project.
The SFZ is Prime Minister Anwar Ibrahim’s attempt to revive the US$100 billion Chinese-led mega project after long delays and weak demand from target buyers in China, which is grappling with capital controls and a prolonged economic slowdown.
Aimed at high net worth individuals from Malaysia and across Asia, the zero-interest tax offer will be part of a Single Family Office Scheme that the government plans to be operational by the first quarter of 2025, said Second Finance Minister Amir Hamzah Azizan.
“Supported by good infrastructure, a competitive talent pool, robust common law practices and effective governance, opportunities abound for family offices,” Amir Hamzah said in his speech at the launch of the SFZ in Johor, where Forest City is being built.
Anwar’s administration has been aggressively pursuing high- and ultra-high net worth individuals to set up family offices in Malaysia, following the family office boom in neighbouring Singapore which managed US$1.3 trillion in offshore assets in 2023, according to estimates by US strategy and management consultancy McKinsey & Company.