PETALING JAYA — The Finance Ministry has announced that a sales tax of between 5% and 10% will be imposed on non-essential goods starting July 1, while the current 0% tax rate on basic necessities will remain unchanged.
Finance Minister II Amir Hamzah Azizan said the move is part of the government’s broader economic reform agenda and aims to ensure a more targeted taxation system.
At the same time, the scope of the service tax will be widened to include sectors such as rent, leasing, construction, financial services, private healthcare, and private education.
However, Amir said exemptions will be provided to avoid double taxation and to prevent additional financial burdens on the public.
“This expansion will come with some exemptions to ensure that Malaysians are not taxed for certain essential services,” he said in a statement issued this evening.
Amir added that the review of the Sales and Service Tax (SST) was carried out following engagement with key stakeholders, including industry associations and tax professionals. Their feedback was taken into account to mitigate potential impacts on businesses and consumers.
“The government is committed to pushing for economic reforms,” he said.
“To ensure that the people are not impacted by the SST review, a targeted approach will be adopted so that essential goods and services remain tax-free.”
The revised SST framework forms part of the government’s strategy to strengthen fiscal sustainability while safeguarding the welfare of the rakyat.
