Malaysia Postpones Plan to Expand Sales And Service Tax
Chris Brown 06 May 2025 11:29EN
The Malaysian government has decided to postpone the plan to expand the scope of the sales and service tax (SST) and increase the tax rate, which was originally scheduled to be implemented on May 1, to ease the pressure on manufacturers who are about to face high tariffs from the United States.
A spokesman for the Ministry of Finance said that the government is refining the relevant guidelines and tax scope to ensure that the new policy can be implemented smoothly.
Prime Minister and Finance Minister Anwar announced the plan in the 2025 fiscal budget, including raising the service tax rate from 6% to 8% and expanding the scope of taxation, but maintaining a 0% tax rate on basic necessities.
As US President Trump announced a reciprocal tariff of up to 24% on goods from various countries, although the White House later suspended the implementation for 90 days, this move still had a huge impact on Malaysian exporters.
A spokesman for the Ministry of Finance said that the government is refining the relevant guidelines and tax scope to ensure that the new policy can be implemented smoothly.
Prime Minister and Finance Minister Anwar announced the plan in the 2025 fiscal budget, including raising the service tax rate from 6% to 8% and expanding the scope of taxation, but maintaining a 0% tax rate on basic necessities.
As US President Trump announced a reciprocal tariff of up to 24% on goods from various countries, although the White House later suspended the implementation for 90 days, this move still had a huge impact on Malaysian exporters.
