The Ministry of Home Affairs (KDN) last week announced good news that the Government finally will be reactivating the Malaysia My Second Home (MM2H) program, which will indirectly help our nation in the economic recovery. According to the Ministry, the reactivation will be emphasizing on improvements to policies and application conditions to balance the security and economic aspects, and the program would be processed and managed by the Immigration Department beginning October 2021 after all legal processes are completed.
Many agencies involved as a major stakeholder to the MM2H program, such as the Malaysian Institute of Estate Agents (MIEA) has proposed that the government defer the new criteria for the MM2H program to December 2022. In the mean time, Industries Unite (IU) & Malaysia My Second Home Consultants Association (MM2HCA) analyzed the new terms, and found the measures announced by the government recently, were shocking, drastic and unreasonable. In this regard, IU (represented by Dato’ David Gurupatham & Datuk Irwin SW Cheong) and the MIEA (Mr Anthony Liew) have published a press release with the hopes of highlighting the Top 10 Important Facts about the MM2H (in regards to the new terms) to the newly appointed Home Affairs Minister, YB Dato’ Seri Takiyuddin bin Hassan:
- ANNUAL CUMULATIVE MINIMUM STAY OF 90 DAYS FOR A NEXT 5 YEARS RENEWAL
MM2H is just a long-term multiple entry Social Visit Pass. There should not have 90 days minimum stay but acceptable with 14days stay. In comparison the Thai Elite Program which is very attractive to retirees doesn’t have any such requirement.
- Increase of monthly income from RM10,000 to RM40,000
MM2H is attractive to foreigners as the cost of living in Malaysia is much lower than in other developed countries. Our neighboring countries offer similar program with much lower income requirements.
a) Thai Retirement Visa for retirees (50 years and above), only required a monthly income or pension of at least 65,000 Thai baht (RM8,260).
b) The latest publication (2019) by the Pension and Lifetime Savings Association (PLSA), UK, states that the average full state pension for a British citizen is only £9,339 (RM58,275) per year. According to a Reuter Report (April 2019), the average employee’s pension in Japan is only about 150,000 yen ($1,350.01) a month. The Japanese are one of the main applicants for the MM2H. The government should not increase within 2 times of the existing term to remain attractive to foreign retiree.
- FIXED DEPOSIT REQUIREMENT
The increase of FD placement from RM 300,000 to RM 1mil is not attractive based on the current global economic downturn due to the COVID-19 Pandemic. As it is, Malaysia is no longer the preferred retirement destination due to the exceptionally high number of the COVID-19 cases and the current economic crisis.
- ADD ON DEPENDENT WITH ADDITIONAL FIXED DEPOSIT
The additional RM50,000 Fixed Deposit for dependents is not a suitable new condition. We need the dependents too spend a lot more in our country to spur our GDP.
- DURATION OF MM2H LONG TERM SOCIAL VISIT PASS
This unique feature of the MM2H program should maintain for 10 years. It losses the advantages if it was only 5years, plus foreigners have other choices as well.
- PROOF OF LIQUID ASSETS
The latest guidelines require applicants to possess RM1.5mil of liquid assets. Honestly, rich investment savvy applicant would not have this sum in liquid assets instead their fund would have been well invested in high yielding products.
- MM2H VISA FEES AND PROCESSING FEES
Existing visa fees is only RM 90/year. An increase of RM 500/year is not very reasonable. Even the visa fees for current Residence Pass is only RM 500/ 5 years and the Employment pass under MIDA, it is only RM300/year. The processing fees which was free previously, has now been increased to RM 5,000 for the main applicant and RM 2,500 for each dependent.
- POLICE VETTING & LETTER OF GOOD CONDUCT
MM2HCA is totally in support of this requirement.
- EXISTING MM2H HOLDERS
It is unethical to subject existing MM2H holders to these new requirements. This “SHIFTING OF THE GOALPOSTS” will reduce foreigner confidence in our government. Drastic changes will tarnish our image and will make us the laughingstock of the world. Many MM2H holders had sold their properties in their home countries and have been living harmoniously with Malaysian and consider Malaysia their Home. They spend freely in Malaysia and have contributed to the economy of this country. It would not be fair to ignore their contribution and then subject them to the new rulings. MM2H is an economically driven program. Special incentives such as biometric identity card, tax exemption for one car to be brought in from their home country are attract effluent foreigner here. After all, Malaysia is not the only country in the region competing for the well-to-do applicants to stimulate the post-pandemic economy.
- CONFIDENCE LEVELS TO PROMOTE MM2H PROGRAM WITH NEW APPLICATION CRITERIA
Based on recent survey conducted by MM2HCA on the reactivation of the MM2H program among licensed MM2H Consultants, 70% has no confidence at all in promoting the program.
In conclusion, IU & MIEA said, “In our view, the new terms are ‘Killing the Goose that Lays the Golden Egg’. The MM2H program can be the catalyst to spur the economy and bring in substantial foreign direct investment into Malaysia. We must use the MM2H program as part of the National Recovery Plan to Stimulate economy Malaysia. The new requirements will ensure the failure of this program and huge lost in our GDP. We sincerely hope the government will re-consider the terms & condition of the MM2H program, where MM2HCA is happy to have more discussion with the Ministry of Home Affairs (KDN) to ensure the success of the MM2H program.”