MOF grants Westports 10-year investment tax allowance

KUALA LUMPUR (Nov 21): The Ministry of Finance (MOF) has granted Westports Holdings Bhd’s wholly-owned subsidiary Westports Malaysia Sdn Bhd (WMSB) a 10-year investment tax allowance (ITA), commencing from Jan 1, 2022 to Dec 31, 2031.

The ITA is to facilitate the capital expenditure (capex) to be incurred by WMSB, with respect to existing and future expansion programmes.

In a bourse filing on Monday (Nov 21), Westports said the ITA was granted to WMSB, following consultations with the MoF and on conditions, among others, that WMSB is required to incur a minimum of RM4 billion in capex to its terminals during the stipulated 10-year period.

“As part of the ITA, 50% of the qualifying capex incurred by WMSB within the stipulated 10-year period can be offset against its statutory taxable income for each year of assessment within the stipulated 10-year period,” it added.

The port operator had in August 2017 unveiled its expansion plans under Westports 2.0, which entails the development of eight new terminals, CT10 to CT17, that will double its container-handling capacity to 28 million 20-foot equivalent units (TEUs), from 14 million TEUs currently. It is in negotiations with the Public-Private Partnership Unit, the Ministry of Transport (MOT) and other relevant government agencies on the concession terms for Westports 2.0. The estimated total development cost of Westports 2.0 is reportedly RM12.6 billion, which will take between 25- and 30 years to fully develop.

Westports shares settled seven sen or 2.08% lower at RM3.30 on Monday, bringing the group a market capitalisation of RM11.3 billion.