Since 1998, Malaysia has imposed a windfall profit levy (WPL) of three percent on palm oil prices above RM3,000 for Peninsular Malaysia and RM3,500 for Sabah and Sarawak, with periodic revisions to the levy rate and price threshold value. Notwithstanding the WPL threshold is based on CPO prices, it is ultimately levied on all oil palm growers (excluding smallholders) on their FFB production.
While the Ministry of Finance has announced that the government will not abolish the WPL, 15 palm oil associations have asked the government to consider a review of the WPL levied on Palm Oil B, to raise the WPL’s effective price threshold for palm oil and to revert the WPL levy rate for growers in Sabah and Sarawak.
Segi Enam Advisors’ Principal, Khor Yu Leng, was invited to BFM to give her insights on the historical contexts of the WPL, why palm oil associations have been imploring the government to review this levy and the CPO yield performance of plantations across the country. She also discussed issues of forced labour on plantations and compliance with the upcoming European Union Regulation on Deforestation-free Products (EUDR).
Catch the full interview to learn more about this contentious levy - Time To Review Palm Oil Windfall Levy?