OIL & GAS
$MISC / 3816 (MISC BERHAD) $PCHEM / 5183 (PETRONAS CHEMICALS GROUP BERHAD) $YINSON / 7293 (YINSON HOLDINGS BERHAD)
Research by CGS
Overweight

“GloBE impact on PCG, MISC and Yinson”

The Global Anti-Base Erosion (GloBE) rules is an initiative of the OECD and G20, whose purpose is to impose a Global Minimum Tax (GMT) of 15% or more on the profits of Multinational Enterprises (MNE) to prevent them from shifting profits to low tax jurisdictions and deprive countries of their rightful tax revenues. This note explores the impact of GloBE on companies like MISC and Yinson that currently enjoy tax exemption on their shipping and FPSO operations in Malaysia and Singapore. Petronas Chemicals Group (PCG), meanwhile, is enjoying just 3% tax on the profits of its Labuan sales entity, which has depressed its effective tax rate (ETR) to below the GMT of 15% for most years. With Malaysia and Singapore embracing the GloBE rules and committed to collecting GMT of 15% from 1 Jan 2025F, this report assesses how they affect PCG, MISC, and Yinson.

Analyst(s):
Raymond YAP, CFA
raymond.yap@cgsi.com