Threshold for annual sales tax to be raised to RM500,000 under SST

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7 August, KUALA LUMPUR – The Government will increase the annual sales threshold for eligibility to register for the Sales Tax to RM500,000 annually under the Sales and Tax Service Tax (SST) from RM100,000 previously.

Finance Minister Lim Guan Eng said the annual turnover threshold of RM500,000 would also apply to manufacturers who carried out sub-manufacturing activities, for which the annual sales threshold was at RM20,000 before.

“This is to enable small-sized manufacturers to operate without having to pay this tax,” he said when tabling the Sales Tax Bill 2018 for the second reading at the Dewan Rakyat today.

Lim said the government expected only 27,456 manufacturers would be registered under the Sales Tax compared with 32,725 under the Goods and Services Tax (GST).

He said subsequently, most manufacturers would fall out of the scope of the Sales Tax and this would eventually reduce the cost of tax compliance and administration for small-sized manufacturers.