If you want to buy something from overseas, you better start buying now, or else your purchases will end up costing you more.
The government will begin collecting a new sales tax in April, which would result in Malaysian consumers paying 10% more each time they purchase items imported from abroad (RM500 and below).
According to a report by Malay Mail, the new sales tax applies to items that cost less than RM 500 and it will be classified as “low-value goods” (LVG). These items are sold online and shipped from overseas to customers in Malaysia by air, sea, or land. The tax applies to all areas of Malaysia, including duty-free islands like Labuan, Langkawi, Tioman, and Pangkor, as well as special areas such as free zones.
This new tax is mandatory starting on 1 April 2023. The shipping fees and insurance costs associated with importing the goods into Malaysia from abroad won’t be subject to this tax.
After 1 April 2023, this is the calculation for the new sales tax:
Item price + 10% sales tax = Price of the good + Shipping = Final price that you have to pay.
The LVG will be subject to sales tax at the time the online store issues the order confirmation.
If you receive the LVG after 1 April but purchased it online before that date, you are exempt from paying the 10% LVG sales tax.
The New Sales Tax Is Not Applicable For These Items
- Cigarettes
- Tobacco products
- Smoking pipes (including pipe bowls)
- Electronic cigarettes and similar personal electric vaporizing devices
- Non-nicotine liquid or gel preparations used for smoking via e-cigarettes or vaping devices
- Intoxicating liquor
After 1 April, your imported goods could end up costing as much as RM50 more for one item.
