KUALA LUMPUR, Dec 5 (Bernama) -- Bursa Malaysia closed lower on Friday amid mixed regional market performance as investors turned cautious over a possible rate hike by the Bank of Japan (BOJ) and upcoming US economic data that may influence the Federal Reserve’s (Fed) interest rate decision next week. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) pared most earlier losses to settle 4.55 points easier, or 0.28 per cent, to 1,616.52 from Thursday’s close of 1,621.07. The benchmark index, which opened 0.37 of-a-point lower at 1,620.70, moved between 1,609.67 and 1,621.25 throughout the day. The broader market was negative, with decliners outpacing advancers 604 to 439. A total of 550 counters were unchanged, 1,151 untraded, and 18 suspended. Turnover declined to 3.17 billion units worth RM2.24 billion from 4.48 billion units worth RM2.75 billion yesterday. Rakuten Trade Sdn Bhd vice-presiden...
Malaysia’s real estate investment trust (M-REIT) sector may face a sharp drop in investor appeal if a long-standing withholding tax relief on REIT distributions expires on Dec 31, 2025, Maybank Investment Bank (Maybank IB) warned.
The concession — in place since YA2016 — keeps tax on REIT income at 10% for most investors, 0% for resident corporates, and 24% for non-resident corporates.
Although repeatedly extended in the past, authorities have remained silent on whether it will continue into YA2026.
What Happens If the Tax Relief Ends?
Maybank IB said that without an extension, REIT distributions would revert to marginal tax rates, potentially cutting post-tax yields by 50–100 basis points.
Such a reduction could:
Lower net income for retail and institutional investors
Make Malaysia’s REITs less competitive versus regional peers
Deter foreign inflows
Undermine sentiment despite the sector’s currently attractive 5.7% average dividend yield
The Malaysian REIT Managers Association is expected to engage the Ministry of Finance as the year-end deadline nears.
Maybank IB’s Top Sector Picks
The research house maintains ‘buy’ calls on six of the eight M-REITs under its coverage, including:
Pavilion REIT (PAVREIT)
YTL Hospitality REIT (YTLREIT)
It holds ‘hold’ ratings on:
KLCCP Stapled Group (KLCC) — comprising KLCC Property Holdings Bhd and KLCC REIT
Al-Salam REIT (ALSREIT)
Comments
Post a Comment