Malaysia's plantations and commodities ministry has proposed a cut in windfall levy for palm oil producers in the states of Sabah and Sarawak to 1.5% from 3%, state news agency Bernama reported on Tuesday, citing Minister Fadillah Yusof.
A proposal has been made to the finance ministry as part of Malaysia's 2024 budget announcement due next week, the minister said, according to Bernama.
Sabah and Sarawak are the largest palm oil producing states in the country.
Planters in Malaysia, the world's second-largest producer of palm oil, have for years asked the government to reassess the tax rate and the threshold for the windfall profit tax.
Malaysia imposes a windfall levy of 3% on palm oil prices above 3,000 ringgit ($635.39) per ton in Peninsular Malaysia and above 3,500 ringgit per ton in Sabah and Sarawak.
($1 = 4.7215 ringgit) (Reporting by A. Ananthalakshmi; Editing by Kanupriya Kapoor)