Malaysia sets tax breaks for Islamic bonds,training

Reuters - Malaysia will exempt taxes for three years on fees and profits earned from non-ringgit Islamic bond deals distributed outside the country to boost the industry, Prime Minister Abdullah Ahmad Badawi said on Friday.

The exemption, effective for the 2009-2011 years of assessment, apply to fees and profits on arranging, underwriting, distributing and trading non-ringgit sukuk, Abdullah announced in the 2009 federal budget.

Malaysia, where more than half of the population of 27 million are Muslims, wants to become a global leader in the $1 trillion Islamic finance industry.

The Southeast Asian country has the world's largest sukuk, or Islamic bond, market, with $66 billion or 62.6 percent of global outstanding sukuk issuance as at end June 2008.

The government also announced a double tax deduction for Islamic finance courses conducted by a Malaysian university to help overcome the shortage of industry experts.