KUALA LUMPUR, Nov 23 — Labuan International Business and Financial Centre (Labuan IBFC) has contributed more than RM1 billion to the country’s fiscal revenue in 2022, said Deputy Finance Minister II Steven Sim.

He said the tax collection was the highest since 1990, which has increased sevenfold since 2018 after the government implemented the ‘substance requirements’ regulation in 2019.

The implementation of the regulations is imposed on institutions and companies.

"Labuan IBFC is one of the three major international financial centres in Asia Pacific focused on external banking, reinsurance and captive insurance companies (apart from Singapore and Hong Kong).

"Labuan has 70 banks that conduct external banking, Singapore has 99 and Hong Kong has 61,” he said during a question and answer session at the Dewan Rakyat today.

He was replying to a question from Datuk Suhaili Abdul Rahman (PN-Labuan) who asked the finance minister to state the latest achievements of Labuan IBFC in terms of economic and development contributions to Labuan since it was established.

On insurance and insurance related companies, Sim said Labuan has 237 companies, Singapore has 180 companies and Hong Kong has 163 companies.

In detail, there are 71 captive insurance companies in Labuan while Singapore has 83 and Hong Kong has only four.

Overall, there are over 940 licenced institutions approved and regulated by the Labuan FSA — it shows a tenfold increase in the number of licensees since 1996.

"Until now, Labuan banks own almost US$50 billion in assets and insurance companies in Labuan have insurance premiums of up to US$1.7 billion,” he said.

Meanwhile, Sim said one of Labuan IBFC’s main contributions to Labuan island was contributing more than 50 per cent to the gross domestic product (GDP) of Labuan island, which reached almost RM5 billion (2019 - 2020), thus making it the largest contributor to Labuan’s GDP.

"From this contribution, approximately 12 per cent or RM600 million is the expenses of the Labuan IBFC entity that needs to be spent in Labuan,” he said.

In addition, Sim said Labuan IBFC is the largest white-collar employer in Labuan with a total of 9,198 employees — that amount covers 20 per cent of the total employment in the whole of Labuan and 90 per cent of which are made up of locals.

"Over the course of three decades, many developments have been implemented to strengthen Labuan’s position as an international business and financial centre in the form of infrastructure improvements (roads/airports/seaports), the establishment of international schools, healthcare and telecommunications,” he said.

The construction of Ujana Kewangan in 1996 which houses an office complex, convention centre, accommodation block and shopping centre has also opened various buildings for the Labuan IBFC community and local residents, he added. — Bernama