Malaysian government reverses decision on levy of foreign workers

The Malaysian government has decided to retain the previous levy payment structure for foreign workers, with employers bearing the full cost, as reported in Bernama.

Previously, Finance Minister Lim Guan Eng had said the government agreed to let employers pay only 20% of the annual RM10,000 levy for each foreign worker, while the foreign workers themselves would bear the remaining 80%.

Minister Lim said the decision was made following complaints from foreign workers and trade unions.

"This annual levy of RM10,000 is applicable only for foreign workers who have worked in Malaysia for more than 10 years and are allowed to extend their permit for a maximum of three years," he clarified, as reported in Bernama.

"However, they (the foreign workers) complained they could not pay their portion amounting to RM8,000, so the government has decided to revert to the original levy structure whereby the RM10,000 payment is borne fully by the employer."

Hence, Lim said, for employers with foreign workers who had served for more than 10 years and now wanted to continue working in Malaysia, they could start paying the annual levy of RM10,000 effective 1 October 2018.

"If the employers do not want to pay the RM10,000, they can first send the foreign workers home and then reemploy them as new workers. So the levy that needs to be paid is only RM1,850," he added.

The Cabinet had agreed to give leniency for employers to retain, for a maximum of three years, their skilled foreign workers holding the Temporary Employment Visit Pass (PKLS) for the past 10 years.

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