- Starting July 1, 2025, Malaysia is rolling out significant changes to its Sales and Services Tax (SST) framework. The government aims to enhance revenue collection and keep up with the evolving economic landscape, especially as more services go digital and consumer patterns shift toward luxury spending. If you’re a business owner, consumer, or digital service provider, here’s what you need to know.
- Higher Sales Tax on Luxury Goods (Now 10%)
To target high-end consumption, certain luxury items will now face a higher sales tax rate:
- Imported fruits (e.g., cherries, blueberries)
- Premium seafood like king crab and salmon
- Racing bicycles and other luxury sports gear
- Antiques, art pieces, and collectibles
- Expanded 6% Services Tax Coverage
More service sectors are now within the SST net, with a 6% services tax applied to:
- Logistics and transportation services
- Construction services (including renovations and sub-contracting)
- Beauty and wellness (spas, salons, aesthetic clinics)
- Private healthcare (consultations, diagnostics, specialist care)
- Private education (tuition centers, international schools)
- Financial services (credit card fees, fund management, brokerage)
- Digital Services by Foreign Providers Now Taxable
Foreign companies offering digital services to Malaysian consumers will be required to:
- Register for SST in Malaysia (if revenue exceeds set thresholds)
- Charge 6% services tax on:
- Streaming services (e.g., video, music platforms)
- Cloud storage and SaaS platforms
- Mobile apps, games, and digital subscriptions
To know more, refer here.