Sales Tax

1. Contents of this presentation are adapted from the current of legislation at the time of presentation. No person should rely on the contents of this publication
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GST (REPEAL) ACT
TRANSITIONAL ISSUES

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TRANSITIONAL ISSUES
 How long would I be able to claim the GST Input Tax after implement of SST?
You are allowed to claim input tax credit within 120 days after the effective date of SST.

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without first obtaining professional advice. We, KTP or THK, shall expressly disclaim all and any liability and responsibility to any person in reliance in whole or
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TRANSITIONAL ISSUES
 What is the treatment for the stock in hand which the input tax has not been claimed belongs
to the GST registered person who will be a registered manufacturer during the Sales Tax era?
The registered manufacturer is STILL allowed to claim for input tax on the stock in hand in the
final GST-03 return.

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GOODS AND SERVICES TAX (REPEAL) ACT 2018
Claim for input tax and refund
8. (1) Any input tax under the repealed Act which has not been claimed before the appointed
date shall be claimed in the return furnished under paragraph 6(2)(a) within one hundred and
twenty days from the appointed date, and the claim shall be considered as the final claim for
all input tax.
8. (2) Subject to verification, audit or investigation, any refund for –
(a) any input tax under section 38 of the repealed Act which has not been made by the
Director General on the appointed date; or
(b) any input tax relating to the claim made under subsection (1)
Shall be paid by the Director General within 6 years from the appointed date.

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DURING TRANSITIONAL PERIOD, WHAT SHALL WE
PAY ATTENTION TO?

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GOODS
 Need to Account for GST for Stock / Assets held in hand?
YES, First Schedule Sub Para 5(8)
A GST registered person must:
- account for GST at 0%, and
- declared the output tax in their final GST-03 return.

7. Contents of this presentation are adapted from the current of legislation at the time of presentation. No person should rely on the contents of this publication
without first obtaining professional advice. We, KTP or THK, shall expressly disclaim all and any liability and responsibility to any person in reliance in whole or
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GOODS
 Supply of Goods on or before 31.08.2018, Tax Invoice is not issued
- Refer to DG’s Decision – You may issue INVOICE after 01.09.2018
- But if you do this way, your customer may not be able to claim the Input Tax (Claiming for
Input Tax, you must hold valid Tax Invoice)
- - Suggesting issue Tax Invoice dated Aug 2018

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without first obtaining professional advice. We, KTP or THK, shall expressly disclaim all and any liability and responsibility to any person in reliance in whole or
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GOODS
 Full payment received on or before 31.08.2018, however Goods to be delivered after AD.
If you are a Taxable Goods’ Manufacturer:
- If GST paid, no Sales Tax
- If GST is not paid, 10% Sales Tax

9. Contents of this presentation are adapted from the current of legislation at the time of presentation. No person should rely on the contents of this publication
without first obtaining professional advice. We, KTP or THK, shall expressly disclaim all and any liability and responsibility to any person in reliance in whole or
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GOODS
 Tax Invoice was issued on or before 31.08.2018, however Goods to be delivered (DO issued)
after AD
If you are a Taxable Goods’ Manufacturer:
- If GST charged & paid, no Sales Tax
- If GST is not paid, 10% Sales Tax

10. Contents of this presentation are adapted from the current of legislation at the time of presentation. No person should rely on the contents of this publication
without first obtaining professional advice. We, KTP or THK, shall expressly disclaim all and any liability and responsibility to any person in reliance in whole or
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RETENTION SUM FOR WORK DONE BEFORE 31.05.2018
DG’s Decision
as at 07.09.2018

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RETENTION FOR THE FOLLOWING PERIODS
On or Before 31.05.2018 - GST @ 6% Treatment
Release On or before 31.05.2018
6% GST
Tax invoice .
Contractor account for 6% GST
Debtor claim input tax.
Release in between 01.06.2018 – 31.08.2018
6% GST
Tax invoice .
Contractor account for 6% GST
Debtor claim input tax.
Release in between 01.09.2018 – 29.12.2018
6% GST
If issue Tax invoice dated on or before 31.08.2018.
Contractor accounts for 6% GST,
Debtor claims input tax.
On or after 01.09.2018, issue INVOICE.
Contractor accounts for 6% GST,
BUT Debtor CANNOT claim the input tax.
Release On or after 29.12.2018
Account for output tax
On or after 29.12.2018, issue INVOICE.
Contractor accounts for 6% GST,
BUT Debtor CANNOT claim the input tax.
Wait for further notice form customs

12. Contents of this presentation are adapted from the current of legislation at the time of presentation. No person should rely on the contents of this publication
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SALES TAX

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IN MALAYSIA
Except prescribed by Minister, Sales Tax is NOT applicable in:-
 Designated Area (DA)
 Special Area (SA)
 Free Zones (FZ)
 The Joint Development Area (JDA)
 Licensed Warehouse (LW)
 Licensed Manufacturing Warehouse (LMW)
DA SA
Manufacturing
Activities in
DA / SA
Not subject to Sales Tax, except for petroleum Except for petroleum
Importation
into DA / SA
Exemption from Sales Tax except:
Langkawi: Importation of marble, petroleum and
anchovies
Tioman: Importation of petroleum and motor vehicles
Labuan: Importation of petroleum
Generally not subject to Sales Tax except for Goods in the
Free Zone which may be subjected to Sales Tax as
provided in the Order
Removal of
Goods
From PCA to DA Deemed export, no Sales Tax From PCA to SA Deemed export, no Sales Tax
From DA to PCA Deemed import, subject to Sales Tax From SA to PCA Deemed import, subject to Sales Tax
To/From DA to DA No Sales Tax To/From SA to SA No Sales Tax
To/From DA to SA No Sales Tax To/From SA to DA No Sales Tax

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WHAT IS TAXABLE GOODS ?
 Goods of a class or kind not for the time being exempted from Sales Tax.
- Goods which are NOT listed under the Sales Tax (Goods Exempted From Tax) Order 2018 is
subject to Sales Tax.

15. Contents of this presentation are adapted from the current of legislation at the time of presentation. No person should rely on the contents of this publication
without first obtaining professional advice. We, KTP or THK, shall expressly disclaim all and any liability and responsibility to any person in reliance in whole or
any part of this contents.
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HTTPS://MYSST.CUSTOMS.GOV.MY/

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any part of this contents.
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17. Contents of this presentation are adapted from the current of legislation at the time of presentation. No person should rely on the contents of this publication
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HS AND HTS CODE (TARIFF CODE)
 Harmonized Commodity Description & Coding System, commonly known as HS codes and
ASEAN Harmonized Tariff Nomenclature (AHTN) were created for international use by the
Custom Department to classify commodities when they are being declared at the custom
frontier by exporters and importers.
 When you don’t comprehend and properly apply proper product classifications for
international shipping, you can face legal penalties which, if you are not prepared, can sink
your business.
 You can also have your goods seized, defeating the very purpose of your business.

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 The HS is organized into 21 sections, with 98 chapters in each section, with each chapter
divided into around 5,000 headings and Subheadings.
Chapter
Heading
Sub-Heading
Sub Sub-Heading
CH HD SH SS

19. Contents of this presentation are adapted from the current of legislation at the time of presentation. No person should rely on the contents of this publication
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HOW TO CHECK TARIFF CODE ?

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without first obtaining professional advice. We, KTP or THK, shall expressly disclaim all and any liability and responsibility to any person in reliance in whole or
any part of this contents.
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21. Contents of this presentation are adapted from the current of legislation at the time of presentation. No person should rely on the contents of this publication
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EXAMPLE FOR YOUNG COCONUT:

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any part of this contents.
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23. Contents of this presentation are adapted from the current of legislation at the time of presentation. No person should rely on the contents of this publication
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EXAMPLE :
08.01
Heading
0801.19
Category 0801.19.10 00
Goods / Item
This is Tariff Code!!!

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HTTP://MYSSTEXT.CUSTOMS.GOV.MY/TARIFF/

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MEANING OF MANUFACTURE
 Conversion of Materials by manual or mechanical means into a new product by changing
the size, shape, composition, nature or quality of such materials and includes the assembly
of parts into a piece of machinery or other products.
 BUT does not include the installation of machinery or equipment for the purpose of
construction.
Materials New Products

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MEANING OF MANUFACTURE
 Include – Installation of tools and
components into machines or equipment,
such as the assembly or personal computer
& television.

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MEANING OF MANUFACTURE
 Simple manufacturing process like
combining two or three tools / components
with screws on a machine is not subjected
to the definition of manufacture provided
that:
- The machine is complete and there are
no additional material used in the new
installation.
- Installation can be made easily and
quickly.

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MEANING OF MANUFACTURE
 In relation to petroleum, any process of
separation, purification, conversion ,
refining and blending.

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SALES TAX IS NOT APPLICABLE
 Goods listed under the Sales Tax (Goods Exempted From Tax) Order 2018.
 Certain Manufacturing activities are ALSO exempted by Minister of Finance through Sales Tax
(Exemption From Registration) Order 2018.

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without first obtaining professional advice. We, KTP or THK, shall expressly disclaim all and any liability and responsibility to any person in reliance in whole or
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SALES TAX IS NOT APPLICABLE

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EXEMPTION FROM REGISTRATION
 Persons whose manufacturing operation is in any one of those specified in Schedule A of the
Sales Tax (Exemption From Registration) Order 2018 are exempted from subsection 13(1) of the
Act irrespective of the total value of sales of taxable goods in the period of twelve months.
 The person carrying on the manufacturing operations in Schedule A shall solely carry on such
manufacturing operations and does not carry on any other manufacturing activity as defined
under section 2 of the Act.

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SCHEDULE A
1. The developing and printing of
photographs and the production of film
slides.
2. The engraving of articles with the name of
the recipient, his sports record or other
circumstances under which the article
was donated or awarded.

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SCHEDULE A
3. The incorporation of goods into buildings.
4. The manufacture of ready mixed
concrete.

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SCHEDULE A
5. The preparations of meals.
6. The preparations of tarred metal, tarred
screenings, and hot mixed preparations of
bitumen and metal for roadmaking.

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SCHEDULE A
7. The production of copies of documents
by the photo copy or similar copying
process.
8. The repacking of bulk goods into smaller
packages by a person other than a
registered manufacturer.

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SCHEDULE A
9. The repair of second hand or used goods.
10. The testing of eyesight, the prescription of
suitable lenses and the fitting of such
lenses into frames.

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SCHEDULE A
11. The following operations when performed
by a person other than a registered
manufacturer:
- the varnishing and or polishing of finished
pieces of furniture.
- the fitting of glass tops and, or glass door
to pieces of furniture otherwise complete.

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SCHEDULE A
12. The reduction of size and or changing of
the shape of taxable materials without
changing the nature of such materials,
provided that the sizing and, or shaping is
not part of the normal process in
manufacture of a separate article.

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SCHEDULE A
13. The rendering of personal tailoring service
but excluding the manufacturing of
garments and other textile articles on the
basis of bulk and not personalized
production by a firm or company
engaged in the business of manufacturing
garments and other textile articles.

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SCHEDULE A
14. The printing of logo, knitting, crocheting or
embroidering on ready made garments
supplied by another person.
15. The coloring of cloth supplied by another
person without changing the size or shape
of the said cloth.

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SCHEDULE A
16. The manufacture of batik fabrics using
traditional techniques of manual block
printing, manual screen printing and, or
hand drawing or painting and the articles
thereof.
17. The installation of air conditioners in motor
vehicles.

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SCHEDULE A
18. The manufacture of jewellery and
goldsmiths wares.

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SCHEDULE A
19. The extraction of gold from mineral ores.
20. The recovery of gold from jewellery and,
or the refining of gold

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SALES TAX (PERSON EXEMPTED FROM PAYMENT OF TAX) ORDER
2018
 Schedule A : Any Person or Class of Person
 Schedule B : Manufacturer of Specific Non taxable Goods
 Schedule C : Registered Manufacturer / any person acting on behalf of Registered
manufacturer

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without first obtaining professional advice. We, KTP or THK, shall expressly disclaim all and any liability and responsibility to any person in reliance in whole or
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SALES TAX (PERSON EXEMPTED FROM PAYMENT OF TAX) ORDER
2018

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without first obtaining professional advice. We, KTP or THK, shall expressly disclaim all and any liability and responsibility to any person in reliance in whole or
any part of this contents.
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