5th September 2018
At Sage, we aim to equip our customers with the latest information, tools and support they need to stay compliant with the changing tax legislations. With the recent Malaysia parliament changes, we are aware that the upcoming abolishment of Goods and Services Tax (GST) and reinstatement of Sales and Services Tax (SST) will impact you in your tax processing. Rest assured that we will be closely monitoring official announcements and keeping you updated on information you need to know to stay compliant.
This is a tax on most products and services for domestic consumption at every level in the production process. GST can be claimed as input tax for companies with revenue above RM500k. GST was implemented in April 2015 replacing SST. GST is the most commonly used form of taxation used by 160 / 190 countries globally. GST is also known as Value Added Tax (VAT) in some other countries.
SST was originally covered by 2 separate tax laws on a wide variety of goods and services at a single level implemented in 1970s. The Sales Tax Act 1972 is a single-stage tax charged typically at the manufacturer’s level. The Service Tax Act 1975 is a single-stage tax charged at the consumer’s level except at tax free zones. The sales tax was at 10% and service tax was at 6% respectively prior to being replaced by GST in 2015.
Hear from Kamlesh Mahtani, Head of Startups and Small Businesses, Sage Asia as he shares on MalayMail about what you should know about SST.
| Tax | GST | SST |
| Tax Revenue Estimate | RM45b | RM20b |
| Tax Base | Narrow | Broad |
| Transparency & Regulation | High | Low |
| Tax Rate (%) | 0%* | 6 - 10% |
| Tax Stages | Multi stage | Single stage |
| Business Input Tax Credit | Yes | No |
| Business Export Tax Relief | Yes | Partial |
| Business Implementation Cost | High | Low |
*Announced to reduce tax rate from 6% to 0% from Ministry of Finance dated 15th May 2018.
Sage is committed in helping you every step of the way to ensure you make a smooth transition in your tax processing with the abolishment of GST and reintroduction of SST.
| 16th May 2018 | First official announcement of upcoming change in GST | |
| 31st May 2018 |
Sage UBS Version 9.9.3.8, Sage POS and BSM Version 9.9.2.4 released with new tax code is enabled
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| Currently till 1st Jun 2018 | No changes to your daily operations and managing of accounts | |
| 1st Jun 2018 | Amend tax rate from 6% to 0% in your accounting system | |
| 8th Jun 2018 | Webinar: GST Change from 6% to 0% (Registration closed) | |
| 16th Jul 2018 | Government to convene on GST abolishment | |
| 1st Aug 2018 | The Customs Department expects to automatically migrate companies that have registered under the goods and services tax (GST) regime to the sales and service tax (SST) beginning tomorrow and will alert them via email. | |
| 8th Aug 2018 | Malaysia's Parliament repealed the Goods and Services Tax Act 2014 after its third reading in the House. | |
| 17th Aug 2018 | Government announced that all GST Registrants are required to submit the GST-03 Return on the final taxable period and make full payment for the amount of tax payable in connection with the supply, for the last taxable period within 120 days from Sept 1, 2018. The non-GST Registrants are required to submit the final GSt-04 Return and make full payment for the amount of tax payable in connection with the supply, for the last taxable period within 30 days by or before Sept 30th, 2018. | |
| 20th Aug 2018 | Dewan Negara today passed five bills related to the implementation of the Sales and Service Tax (SST), which is set to take effect on Sept 1, 2018. These are the Sales Tax Bill 2018, Service Tax Bill 2018, Goods and Services Tax (Repeal) Bill 2018, Customs (Amendment) Bill 2018 and Free Zones (Amendment) Bill 2018. | |
| 23rd Aug 2018 | Seminar: Preparing Businesses on new Indirect Tax Landscape | |
| 24th Aug 2018 | Webinar: Preparing Businesses on new Indirect Tax Landscape | |
| 30th Aug 2018 | Sage UBS version 9.9.3.9 is 100% SST ready! Check out user guides for Sage UBS product series here. |
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| 1st Sep 2018 | Implementation of Sales & Services Tax (SST) | |
| 6th Sep 2018 | Webinar: Road to Sales & Service Tax | |
| 7th Sep 2018 | Webinar: Road to Sales & Service Tax | |
| 12th Sep 2018 | Webinar: Road to Sales & Service Tax | |
| 30th Sep 2018 | Deadline for Sage Cover Renewal Promotion |
The above table content is updated as of 5th Sep 2018.
We know you want as much information as you can get on SST and GST, so we’ve pulled together some resources for your review. We will continue to monitor further official announcements from the relevant Malaysian authorities and update with more information pertaining to GST and SST.
Get access to pertinent information on GST updates straight from official websites.
Transitional 6% to 0% GST
Updated as of 3rd Sep 2018