Malaysia's 2021 draft budget offers special income tax relief for key foreign employees as the jurisdiction seeks to encourage the establishment of global and regional hubs.

The relief applies to companies investing in new strategic investments through the country's National Economic Recovery Plan (PENJANA), announced in June 2020.

According to law firm Baker McKenzie, up to five highly paid individuals will be able to opt for tax at a flat 15 percent rate for five consecutive years if they adopt Malaysian tax residency.

This is instead of the 30 percent they would be paying.

The PENJANA incentives a...