13 Associations Unite to Call for Reinvestment of Windfall Profit Levy Into The Plantation And Commodities Sector

1.               Malaysian Palm Oil Association (MPOA)

2.               Malaysian Estate Owners’ Association (MEOA)

3.               Sarawak Oil Palm Plantation Owners Association (SOPPOA)

4.               East Malaysian Planters Association (EMPA)

5.               Sarawak Dayak Oil Palm Planters Association (DOPPA)

6.               Palm Oil Millers Association (POMA)  

7.               Malayan Edible Oil Manufacturers’ Association (MEOMA)

8.               Malaysian Oleochemical Manufacturers (MOMG)

9.               Malaysian Biodiesel Association (MBA)

10.           Malayan Agricultural Producers Association (MAPA)

11.           Incorporated Society of Planters (ISP)

12.           Palm Oil Refiners Association of Malaysia (PORAM)

13.           National Association of Smallholders (NASH)  

The 13 associations under the Plantation and Commodities sector, calls on the Government to reinvest collections from the Windfall Profit Levy (WPL) into the plantation and commodities industry through the Ministry of Plantation and Commodities (KPK).

Despite repeated appeals, the WPL continues to burden the plantation industry. The industry highlights that the continuous implementation of the so-called “Windfall” Profit Levy has created additional costs and imbalances, particularly when plantation companies are already required to subsidise the nation’s cooking oil programme on behalf of the Government. No other industry has been singled out in this way.

The associations stress that funds collected from WPL must not disappear into general revenue but instead be channelled back to strengthen the sector in the following areas:

1. Replanting – High costs and insufficient incentives have slowed down replanting, threatening future yields. Directing WPL funds into a structured planting cess would allow soft loans and targeted support to rejuvenate ageing estates.

2. Mechanisation & Technology – Rising input and labour costs require urgent adoption of mechanisation, automation, and green energy. WPL funds should be used for R&D, tax incentives, and pilot projects that improve efficiency and reduce reliance on foreign workers.

3. Sustainability & Market Access – The industry is under increasing global scrutiny to comply with deforestation rules, carbon credit requirements, and renewable energy standards. Channelling WPL collections into sustainability initiatives such as biogas, biomethane, and carbon certification is critical to preserving Malaysia’s market access.

4. Cooking Oil Subsidy / Price Stabilisation – With crude palm oil (CPO) prices elevated and exceeding RM3,900 per tonne, cooking oil manufacturers and packers continue to bear heavy losses in maintaining the Government’s ceiling price for the bottled cooking oil programme. The current ceiling price of RM2.50 per kg is unsustainable and the gap between actual CPO prices and subsidised oil prices is widening. This not only places extreme financial strain on manufacturers but also raises concerns about the sustainability of the subsidy system itself.

The associations urge the Government to urgently review the ceiling price of bottled cooking oil to reflect market realities, or alternatively, allocate part of the WPL collections to offset the subsidy burden borne by the industry. Without such relief, the continuation of this policy risks eroding industry viability and undermining supply stability.

The associations further call for a review of the WPL threshold to ensure it truly reflects a “windfall” situation, rather than taxing the industry at levels close to production costs. With current production averaging RM2,600–3,000 per tonne and fertiliser costs rising by 30% since late 2024, the existing levy of RM150 per tonne is punitive rather than reflective of extraordinary profits.

“The Windfall Profit Levy cannot remain just another source of government revenue. It must be reinvested into the plantation and commodities industry to drive replanting, mechanisation, sustainability, and to ease the cooking oil subsidy burden. At today’s costs, the situation is unsustainable. Redirecting WPL funds back to the Ministry is the only fair and logical path forward,” said the associations collectively.

The associations reiterate its commitment to national food security, rural development, and economic sustainability. But this requires a fairer framework where funds collected from the industry are reinvested into the industry itself.