The heated debate over the Employees Provident Fund (EPF) contribution rate for foreign workers has come to a head when the government unanimously decided to set 2% as the new rate, which is much lower than the original 12%.
Prime Minister Datuk Seri Anwar Ibrahim announced the decision during the ACCCIM 2025 Chinese New Year Celebration, stressing that the government is prepared to increase the rate to 4% when the economic situation improves.
The decision was welcomed by the Federation of Malaysian Manufacturers (FMM), which stressed that it provides cost certainty to industries that rely on foreign workers.
FMM President Tan Sri Soh Thian Lai also stressed the importance of discussions with the private sector before any policy changes are made.
With employers now ‘off the hook’ of the additional cost burden, the question is, is this a win for business, or a loss for foreign workers?
