Malaysia to Implement Sales Tax on Low Value Goods Starting 1 January 2024
Malaysia will implement sales tax on low value goods (LVG) beginning 1 January 2024. This was announced by the Royal Malaysian Customs Department (RMCD).
The relevant laws pertaining to the sales tax are available on RMCD. Anyone who wishes to access the details can do it via the LVG portal.
What Are Low Value Goods (LVG)?
All goods (excluding cigarettes; tobacco products; intoxicating liquors; smoking pipes (including pipe bowls); electronic cigarettes and similar personal electric vaporizing devices; and preparation of a kind used for smoking through electronic cigarette and electric vaporizing device, in forms of liquid of gel, whether or not containing nicotine) which are sold at a price not exceeding MYR500 and are brought into Malaysia by land, sea or air.
What is the sales tax rate on LVG?
The sales tax rate on LVG is 10%.
How is the sale value for LVG determined?
The sales tax is charged on the sale value of LVG not including any tax, duty, fee or other charges such as transportation, insurance or other costs.
What is the threshold value for LVG sellers to be registered?
Sellers from Malaysia or outside Malaysia who sell LVG on an online platform or operates an online marketplace for the sale and purchase of LVG are required to be registered if the total sale value of LVG brought into Malaysia exceeds RM500,000 in 12 months.
How to Register for the LVG Sales Tax?
Registrations can be done online via the LVG system.
When and how does RS need to submit a return for sales tax on LVG?
RS needs to submit a return for sales tax on LVG every three (3) months according to the taxable period by filling in the LVG-02 form via https://lvg.customs.gov.my.
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