SRI Sukuk and Bond Grant Scheme
As part of ongoing efforts to encourage green financing the Green SRI Sukuk and Bond Grant Scheme was established by the Securities Commission Malaysia. The Scheme, administered by Capital Markets Malaysia is to cover the costs incurred by issuers for independent expert review of sustainable sukuk issuances under the SC’s SRI Sukuk Framework and bond issuances under the ASEAN Green, Social and Sustainability Bond Standards.
To incentivise eligible issuers in defraying the external review costs incurred for the issuances of sukuk under the SC’s SRI Sukuk Framework and bonds under the ASEAN Green, Social and Sustainability Bond Standards. Expanded from the previous Green SRI Sukuk Grant Scheme, the SRI Sukuk and Bond Grant Scheme is aimed at lowering the cost of issuances and encouraging continuous issuances of SRI sukuk and bonds in advancing Malaysia as a regional sustainable finance hub.
- Issuer can claim for the Grant based on an issue or programme.
- Should there be more than one issuance requiring a separate external review, the issuer is able to claim on that review cost incurred.
- Claim amount
90% of the actual external review cost subject to a maximum of RM300,000.
- Eligibility for issuances that qualify for the SRI Sukuk and Bond Grant Scheme
- Green SRI sukuk issuances made under the SC’s SRI Sukuk Framework from January 2018 onwards;
- Social, sustainability or other SRI sukuk issuances made under the SC’s SRI Sukuk Framework from 25 August 2020 onwards; or
- Bond issuances made under the ASEAN Green Bond Standards, ASEAN Social Bond Standards or ASEAN Sustainability Bond Standards from 29 October 2020 onwards.
- Application period for the SRI Sukuk and Bond Grant Scheme
From January 2021 until fully utilised.
- Tax incentive
As announced in the Malaysian 2021 Budget, income tax exemptions are provided for the recipient of the SRI Sukuk and Bond Grant Scheme for five years from Year of Assessment (YA) 2021 until YA 2025.
Tax Deduction on SRI Sukuk and Bond Issuances
A tax deduction is applicable for expenditures from the issuance of all types of bonds and sukuk that achieve green, social and sustainable standards in Malaysia that are approved by the Securities Commission Malaysia, up till year of assessment 2025.