GST Relief in Malaysia

Updated on Sunday 24th September 2017

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The supply of goods for export to a foreign customer and the services directly linked to these supplies will benefit from GST relief, according to the published Relief by Minister of Finance 1/2017. Our lawyers in Malaysia detail the provisions of this relief and the services to which it applies.

GST relief for some export-oriented activities

A Relief by Malaysian Minister of Finance applies to a number of activities related to exports to overseas customers. The GST relief will thus apply to the following:
- the supply of services directly connected to the goods prepared to export to a foreign customer;
- the supply of services by a company that operates in a free zone, directly connected to goods exported to an overseas customer;
- the supply of services connected to goods involved in R&D activities performed for an overseas customer;
- the supply of machine or tool services directly connected to machines or tools offered to an overseas customer.

For some of these cases, additional approvals are needed before the GST relief can apply. The service provider needs to keep and maintain the documents that prove the relationship with the overseas customer.

One of our attorneys in Malaysia can give you more details on how the services that are being supplied in the cases described above are eligible for GST relief. 

The goods and services tax in Malaysia

The gods and services tax in Malaysia is the equivalent of the value added tax in Europe. This indirect tax applies to the provision of goods and services, in a multi-stage manner (it is levied at each stage of the supply chain). Malaysia has three types of categories for this type of tax: standard rate, zero-rate and exempt. The current standard GST rate in Malaysia is six percent.

It covers all sectors of the economy in Malaysia and companies doing business here need to register for tax purposes.

You can contact the experts at our law firm in Malaysia for more information on the tax laws, tax registration and requirements for filing and reporting.