KUALA LUMPUR (July 28): CTOS Digital Bhd’s major subsidiary has obtained a five-year extension of tax exemption, effective from Nov 9, 2021 until Nov 8, 2026.
In a filing with Bursa Malaysia on Thursday (July 28), CTOS Digital said its wholly-owned unit CTOS Data Systems Sdn Bhd has received the approval in principle from the Ministry of Finance via Malaysia Digital Economy Corp Sdn Bhd (MDEC) on the extension of income tax exemption under Section 127(3)(b) of the Income Tax Act 1967.
The approval in principle is application until the amendment of provisions for the extension of the second five-year period is approved and gazetted, the group said.
This translates to an estimated effective tax rate of about 4% for CTOS Data and 7% for CTOS Digital, it added.
CTOS Digital said the total incremental tax provision from Nov 9, 2021 to June 30 this year is about RM7.8 million, and will be written back once the extension is approved and gazetted.
CTOS Digital’s shares gained seven sen or 5.1% to close at RM1.44 on Thursday, giving it a market capitalisation of RM3.33 billion.