Sign up for tax alert emails    GTNU homepage    Tax newsroom    Email document    Print document    Download document

July 24, 2018
2018-5900

Malaysia Tax Authority publishes FAQs and proposed implementation models for SST

In preparation for the re-introduction of the Sales and Service Tax (SST) on 1 September 2018, the Royal Malaysian Customs Department (RMCD) has released a list of frequently asked questions (FAQs) and details pertaining to the proposed implementation models for SST.

The table below summarizes the key points of the proposed SST implementation models:

Framework

Sales Tax

Service Tax

Scope

Levied on:

  • Taxable goods manufactured in Malaysia by a taxable person and sold by him; and
  • Taxable goods imported into Malaysia

Charged on any provision of taxable services made in the course or furtherance of any business by a taxable person in Malaysia

Registration and threshold

Person who manufactures taxable goods and the annual turnover exceeds the MYR500,000 (approx. US$123,000) threshold

Service provider who provides taxable services and the value of the taxable services provided for a period of 12 months exceeds the MYR500,000 threshold

Rate(s)

5%, 10% or a specific rate

Fixed rate of 6%, and a specific rate of MYR25 (approx. US$6) for the provision of credit card or charge card services

Filing of returns

Submission on a bi-monthly basis via electronic filing or by post

Submission on a bi-monthly basis via electronic filing or by post

The scope of the Service Tax has been expanded to include provision of IT services, electricity and domestic flights, except Rural Air Services.

Along with the expansion in scope, it is anticipated that certain exemptions from the previous SST legislation will be removed or restricted under the new Acts such as exemption for the provision of services to companies within the same group and certain other exemption facilities.

RMCD has also clarified that it will carry on with Goods and Services Tax (GST) audits for closure purposes after the SST comes into effect.

Access the list of FAQs, the proposed implementation models for SST, and the list of proposed goods exempted from Sales Tax using the links below:

———————————————
CONTACTS

For additional information with respect to this Alert, please contact the following:

Ernst & Young Tax Consultants Sdn Bhd, Kuala Lumpur

  • Aaron Bromley
    aaron.bromley@my.ey.com
  • Lindsey Cruickshanks
    lindsey.cruickshanks@my.ey.com
  • Meynard Lacay Sardalla
    meynard.sardalla@my.ey.com

———————————————
ATTACHMENT

PDF version of this Tax Alert

 

 
 

The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice or opinion provided by Ernst & Young LLP to the reader. The reader also is cautioned that this material may not be applicable to, or suitable for, the reader's specific circumstances or needs, and may require consideration of non-tax and other tax factors if any action is to be contemplated. The reader should contact his or her Ernst & Young LLP or other tax professional prior to taking any action based upon this information. Ernst & Young LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.

 

Copyright © 2024, Ernst & Young LLP.

 

All rights reserved. No part of this document may be reproduced, retransmitted or otherwise redistributed in any form or by any means, electronic or mechanical, including by photocopying, facsimile transmission, recording, rekeying, or using any information storage and retrieval system, without written permission from Ernst & Young LLP.

 

Any U.S. tax advice contained herein was not intended or written to be used, and cannot be used, by the recipient for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code or applicable state or local tax law provisions.

 

"EY" refers to the global organisation, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.

 

Privacy  |  Cookies  |  BCR  |  Legal  |  Global Code of Conduct Opt out of all email from EY Global Limited.

 


Cookie Settings

This site uses cookies to provide you with a personalized browsing experience and allows us to understand more about you. More information on the cookies we use can be found here. By clicking 'Yes, I accept' you agree and consent to our use of cookies. More information on what these cookies are and how we use them, including how you can manage them, is outlined in our Privacy Notice. Please note that your decision to decline the use of cookies is limited to this site only, and not in relation to other EY sites or ey.com. Please refer to the privacy notice/policy on these sites for more information.


Yes, I accept         Find out more