Malaysia’s GST will be zero-rated effective 1 June 2018

Posted:  May 16, 2018   By:    10 comments   


After debunking a false release that GST will be abolised, the Ministry of Finance of Malaysia has declared that the goods and services tax (GST) will be zero-rated from 1 June.

According to the official release posted on the official Ministry of Finance Facebook page, this will cover both local and imported goods and services. GST isn’t abolished but its current 6% rate will reduce to 0% effective 1 June 2018 nationwide until further notice. This excludes goods and services that are currently GST exempted.

The release also mentions that all registered businesses must follow the new zero rating and they must adhere to the current practice of issuing tax invoices, submission of tax statements and claiming of input tax credit.

The Royal Malaysian Customs Department has also shared the same post from the Ministry of Finance. For further clarification, the Royal Malaysian Customs Department is reachable at 1 300 88 8500 or 03-7806 7200.

So what does this mean to the rest of us? At the moment, Malaysian prepaid users get instant GST refund after topping up however the 6% tax is still applicable for postpaid mobile and broadband users. With this new zero-rated GST, this could mean slightly lower bill cost and price reduction for smartphone, tablets and pretty much all goods and services that are currently imposed with the 6% GST.

It is worth pointing out that GST isn’t abolished yet and at the time of writing, there’s still no official announcement of reintroducing the previous Sales and Services Tax (SST) in Malaysia. The current Pakatan Harapan administration had promised to replace GST with SST so this could be a first step to that direction. Tan Sri Zeti Akhtar Aziz, who is one of the five-member Council of Eminent Persons had mentioned that the decision to abolish GST is final and work is in progress towards abolition.

Will this affect your current purchase decision? Let us know in the comments below.


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10 Comments for Malaysia’s GST will be zero-rated effective 1 June 2018

A

Hi. Does anyone has any info about previous dated bill prior to the abolishment of GST. For eg my bill deposit paid for items dated few months ago. And now I would like to collect my item by settling the remaining balance. Do I still need to pay GST?

Simple example. I purchase an Item for RM1060. GST RM60. I have paid RM300 as deposit before this. Now I would like to settle the balance. Do I pay RM700 or RM760? I’m confused.

    Chen

    Depending when your invoice / full invoice is issued.
    If dated after May, it will be 1000.
    If full invoice is pre, GST apply. You have to pay 1,060 minus deposit.

AW

Yes, I was planning on buying a new phone, but decided to on hold till next month after I read the news.

May

Does anyone know whether the business still need to issue tax invoices after 1st June?

    farah

    Yes as well as reporting still need to be done until further notice or announce.

Reva

Hi, I’m in process of buying a new car and the LO from bank is ready for me to sign. But, I’m thinking of waiting until 1st June when GST is reduced to 0%. However, I was told by the sales man that if not GST I have to pay SST. Will SST comes to implementation automatically when GST is 0%?If I’m signing the LO on 1st June do I entitled for SST or no tax? Confused.

    Good Samaritan

    "It is worth pointing out that GST isn’t abolished yet and at the time of writing, there’s still no official announcement of reintroducing the previous Sales and Services Tax (SST) in Malaysia."

    SST won't be implemented until further notice. GST is still in power but it's 0-rated.

Eddie O'Toole

Are F& B outlets still allowed to charge GST? I challenged a restaurant bill this evening but they insisted that they are still required to charge the tax.

    merry

    next month lahhhh.. read the article!

Jay

Hi, would like to know for services, if the invoice period is a cross month (for example 16/05/2018 – 15/06/2018), is a must the tax invoice to be separate in 16/05/2018 – 31/05/2018 with GST and 01/06/2018 – 15/06/2018 without GST)?