Malaysia: Is the expanded SST the new GST?

Published Nov 11, 2024

Tridge summary

Budget 2025 in Malaysia introduces changes to the sales and service tax (SST), including the taxation of non-essential items like avocado and salmon, while luxury goods tax plans remain uncertain. The government is reviewing which items to potentially include under the expanded SST, considering cultural factors and the effects on the economy. The budget also anticipates increased tax collection from imported and local goods sales, and aims to boost development spending through investments by government-linked companies, reaching RM120 billion over five years. The article also highlights the government's efforts to increase revenue and stretch resources to fulfill promises, with a subscription promotion for The Edge magazine to provide more in-depth financial insights.

Disclaimer:The above summary was generated by Tridge's proprietary AI model for informational purposes.

Original content

This article first appeared in The Edge Malaysia Weekly on November 4, 2024 - November 10, 2024 AMONG the surprises sprung by Budget 2025 were the silence on the previously planned high value goods tax (HVGT) on luxury goods and that avocado and salmon would be among “non-essential items” and “imported premium goods” taxed under the expanded sales and service tax (SST) from May 1, 2025. Treasury Secretary-General Datuk Johan Mahmood Merican said something akin to an open-ended reply when asked why the government had chosen to tax avocado and salmon but not jewellery and handbags. Does that mean luxury goods can still be part of the expanded SST, given that only “basic food items consumed by the rakyat” have been exempted from the sales tax expansion? “I’m in a situation where I can neither confirm nor deny [the statement],” Johan tells The Edge. “As part of the expansion of sales tax, we are definitely not imposing it on basic goods, but we’re certainly still reviewing areas that ...

Source: Theedgemarkets