In Malaysia, the Goods & Services Tax (GST) was replaced with the Sales & Service Tax in September 2018.
Below, we look at the difference between the two.
GOODS AND SERVICES TAX (GST)
Multi-stage tax
Broad-based, levied on all goods and services including imports (unless specifically excluded)
The standard rate of tax: 6%
Certain supplies are treated as zero-rated, exempt or are subject to relief.
Mandatory registration upon reaching a threshold of RM500,000 (voluntary registration also possible).
Input tax can be offset against output tax.
Returns filed either monthly, bi-monthly or quarterly (with the option to request an alternative filing period).
SALES AND SERVICE TAX (SST)
Single-stage tax
Levied on all locally manufactured/imported goods and certain prescribed services
Sales tax: 10%
Service tax: 6%
Sales Tax: A license has to be obtained if annual sales turnover exceeds RM100,000
Service Tax: A range of registration thresholds from 0 to RM3mil
No tax credit mechanism
Returns filed on a bi-monthly basis