Malaysia’s skilled migration trend shifts from brain drain to brain circulation through diaspora programmes and tax incentives for returning experts.
KUALA LUMPUR: Malaysia’s skilled labour migration trend is shifting from brain drain to brain circulation through initiatives connecting the diaspora with domestic economic opportunities.
Deputy Health Minister Datuk Lukanisman Awang Sauni said the Malaysia at Heart (MyHeart) programme enables professionals abroad to contribute to the domestic ecosystem without permanent return.
“This initiative connects the Malaysian diaspora with economic, social and cultural opportunities back home, creating sustained links and allowing the country to benefit from their expertise,” he said during a Special Chambers session.
TalentCorp has implemented key strategies including the Knowledge Worker Programme in the Johor-Singapore Special Economic Zone, offering a flat 15% tax rate for 10 years to returning skilled Malaysians.
The agency is conducting a Salary Benchmarking Study to assess salary structures and living costs between Malaysia and Singapore as basis for retention strategies.
The Returning Expert Programme remains a key instrument in encouraging Malaysians to return and serve the country.
Since its 2011 implementation until October 2025, TalentCorp received 12,050 applications with 7,627 approved and 4,963 individuals having returned to work in Malaysia.
REP provides various incentives including a flat 15% tax rate for five years, tax exemption on personal effects, and excise duty exemption of up to RM100,000 for locally assembled vehicles.
“Through these integrated strategies, the government is confident that the talent migration phenomenon can be reduced, ensuring Malaysia remains competitive in attracting and retaining highly skilled human capital,” Lukanisman said.
Regarding the proposed Critical Occupation Remuneration Act, he said any proposal must be thoroughly reviewed within the Public Service Remuneration System framework to avoid disrupting current remuneration balance.
The SSPA, effective since December 1, 2024, was designed to enhance the attractiveness and fairness of public service remuneration structure.
The concept of critical occupations has been applied since 1992 through the Critical Service Incentive Payment, with no new expansions planned under SSPA as assessment shows low supply and difficult placement issues no longer occur at the same level.
National-level review of critical occupations is carried out through the Malaysia Critical Occupational List under TalentCorp, serving as the main reference for skilled workforce planning.
Any introduction of new remuneration levels carries major fiscal implications including effects on pension rates and must be decided by technical ministries with Finance Ministry input.
“In line with public sector reform and expenditure control policies, the government does not encourage the establishment of new statutory bodies or entities unless strongly justified,” Lukanisman said.
