What You Need To Know About SST

What You Need to Know About Sales & Service Tax (SST)

What is Sales Tax?

  • Sales tax is charged on taxable goods that are manufactured in / imported into Malaysia whereas manufactured goods exported would not be subject to sales tax.
  • The proposed sales tax rate is at 5%, 10% or on a specific rate. Manufactured goods are taxable unless specifically listed as goods exempted from sales tax.
  • Taxable person is a person who manufactures taxable goods and is liable to be registered if the annual turnover has exceeded RM500,000.00 threshold.

What is Service Tax?

  • Service tax is imposed on any specific prescribed services provided by a taxable person in the course or furtherance of any business in Malaysia.
  • Neither imported nor exported services are not subject to service tax.
  • The proposed service tax rate is fixed rate of 6% and a specific rate for credit/charged card.
  • Taxable person is a 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.

Transitional Matters from GST to SST

Existing GST Registrants will immediately be liable to be registered under sales and service tax. These registrations will be made automatically within 24 hours. Hence, no further actions are required by these registrants. However, where verification is required, the processing time should take slightly long and registrants affected will be informed either by personal/business e-mail, or by formal letter from 1st August 2018 onwards.

Whereas for GST Registrants who fulfilled the criteria to be registered under GST but were not registered by 1st of September 2018 must apply and register through the MySST website within 30 days from the date of commencement.

As the GST Act 2014 is repealed, all GST Registrants automatically cease to be a GST registered person from the GST system, and no application for de-registration will be required. Nevertheless, all GST Registrants are required to submit a final GST-03 Return and make full payment within 120 days from 1st of September 2018. (Deadline: 29th December 2018)

Voluntary registration is allowed, provided that you are manufacturing taxable goods. Such registration will be processed online via MySST website. Voluntary registrants may need to apply individually online via MySST website and will be notified of registration or in the absence of a notification.

Registration cancellation of auto-registered SST can be done via email (daftarcjp@customs.gov.my). please note that cancellation will be approved automatically effective 31st August 2018 based on declaration statement in application. Applicants will be notified via email, to the email address used to apply for cancellation. There is no need to charge Tax as of 1st September 2018.