Updates: New SST Tax Code Rate 8%

This notice informs you of the upcoming revision to the Sales and Service Tax (SST) rate in Malaysia, effective 1 March 2024. The SST will increase from 6% to 8%, applicable to a range of taxable goods and services.

Impact of the Revision

This adjustment aims to augment government revenue streams while minimising any negative impact on consumers. It is important to note that:

• Not all businesses utilize the 8% SST rate. The revised rate applies only to specific goods and services outlined under SST regulations. Certain items may have a different rate or be exempt altogether.
• Essential services like food, beverages, and telecommunications remain unaffected. However, the revised rate will now encompass previously untaxed services such as logistics, brokerage, underwriting, and karaoke.

Broadening the Tax Base

By incorporating previously untaxed sectors, the government strives to achieve a fairer distribution of the tax burden and generate revenue from untapped sources.

Implementation Details

To facilitate a smooth transition, the following information is provided:

• New tax codes have been introduced for users to implement the revised rate in their daily business operations:
  • SV08
  • IM08 (applicable to both SST & SST-02A)
  • TD08
  • D08
• Users can select the appropriate tax code when creating relevant business transactions to apply the 8% SST rate effectively.
• The 8% SST rate will be available for user application in relevant transactions by 1 March 2024.
• Full implementation in Financio reports, including SST Summary and SST Details reports, is anticipated by 8 March 2024.

Awaiting Updated SST Form

We are currently awaiting the release of an updated SST form from the Royal Malaysian Customs Department (RMCD). This delay is necessary to adhere to the latest regulatory requirements and ensure compliance. Once the exact form specifications are announced, all system changes will be automatically reflected for users.

We appreciate your understanding and cooperation as we navigate this regulatory update. For any inquiries, please do not hesitate to contact us.