Politics · Malaysia Bureau
Malaysia rules out GST return, commits to SST amid living costs crisis
The Malaysian government has firmly rejected returning to the Goods and Services Tax, reaffirming its commitment to the Sales and Service Tax as the preferred indirect taxation system. Officials cited concerns over the rising cost of living as a key factor in maintaining the current SST framework.
LSN Malaysia ·
KUALA LUMPUR — The federal government will maintain the Sales and Service Tax (SST) as its indirect taxation mechanism and has ruled out reverting to the Goods and Services Tax (GST), a senior finance ministry official said on Monday.
The decision reflects the administration's determination to shield consumers from additional financial pressures as Malaysia grapples with elevated living expenses affecting households nationwide. Policymakers expressed confidence that the SST structure provides an appropriate balance between revenue generation and public affordability.
The government's position underscores its broader economic strategy during a period of inflationary pressures. Officials indicated that any tax policy adjustments would be carefully evaluated against their potential impact on ordinary Malaysians' purchasing power and household budgets.
The SST was reintroduced in 2018 following the previous administration's abolition of the GST. The current system taxes goods and services at varying rates, with most essential items exempted or subject to lower levies compared to the earlier GST regime.