Malaysia Offers Stamp Duty Relief for Employment Contracts

Malaysia Announces Stamp Duty Exemption for Employment Contracts Kuala Lumpur, June 6, 2025 – The Malaysian government has introduced a stamp duty exemption for all employment contracts finalized before January 1, 2025. This initiative, announced today, aims to ease the financial strain on employers and ensure smoother compliance with the 1949 Stamp Act. The move comes in anticipation of the Self-Tax System (STDS) rollout on January 1, 2026. "This exemption is a proactive measure to prepare for the upcoming STDS," explained a government spokesperson in a press release. "We want to minimize disruption for businesses and ensure a seamless transition to the new system." The exemption covers the RM10 stamp duty and any associated penalties for late submissions. The government has clarified that contracts signed after January 1st, 2025 will still be subject to the standard stamp duty and penalties for late payments. This exemption is part of a broader effort to modernize Malaysia's tax system and improve efficiency for businesses. The Inland Revenue Board of Malaysia (HASIL) has already begun a nationwide audit of stamp duty, ensuring compliance with the new regulations. This proactive approach demonstrates the government's commitment to transparency and fair tax practices. The exemption is expected to provide significant relief to businesses across Malaysia, particularly small and medium-sized enterprises (SMEs).