A sales and service tax regime in Malaysia has a proposed effective date of 1 September 2018. With enactment of the new sales and service tax regime, the existing goods and services tax (GST) system would be repealed. There would also be changes to the customs rules because of the new sales and service tax regime.
The sales and service tax legislation, and related bills for repeal of the GST regime and customs measures, have received “first reading” as part of the legislative process. Under the sales and service tax regime, it could be possible for services to be subject to tax at multiple stages of the supply chain, leading to a possible cascading of tax. Unlike the current GST system, service tax would not be a creditable tax.
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