Details About SST
In Malaysia, the Sales and Services Tax (SST) was introduced to replace the Goods and Services Tax (GST). SST is imposed on both domestic and imported products alike. However, in many ways, SST bears similarities to GST. Despite these similarities, one important difference lies in the number of products which are exempted from SST. There are far more products which are exempted from SST than there ever were which were exempted from GST.
According to the laws regarding SST, all goods, products, and services purchased on the islands of Langkawi, Tioman, and Labuan are to be exempted from the tax. SST is comprised of two elements. The first of these is that the service tax is to be levied and paid in conjunction with taxable services which are provided in and supported by any individual in Malaysia who is taxable. The second of these is that the sales tax on manufactured and produced local goods is either to be imposed at the time of purchase of the goods or at the time of the disposal or sale of the goods by the producer.
Why SST Was Introduced
One of the SST’s advantages is a lower cost of living in Malaysia because the seller pays the sales tax at the point of sale only once. Furthermore, the service tax limit with regard to food and beverages has risen to RM1.5 million per year and the cost of food supply paid by hawkers, food vendors, and small restaurants has also been reduced. In this way, such businesses benefit tremendously from the effects of SST. Of course, all companies in Malaysia must first ascertain if they are to be subject to SST. The current regulations define all producers and service providers who are to be subject to SST. Thus, producers and service providers who are uncertain of their status pertaining to SST should take a closer look at the regulations for further information.