Service tax in Malaysia is governed by Service Tax Act 1975. This act is in effect in all parts of Malaysia except Langkawi, Tioman, Labuan and free trade areas as determined by the government. And for those who are new in business, you would have to pay your service tax to the Royal Malaysian Customs.
Please be reminded that your service tax is charged according to 2 factors which are:
- the nature of your business and;
- annual turnover (revenue) threshold.
Here is what I mean: company which provide employment services with an annual turnover of RM150,000 needs to get service tax license and must pay 5% to the Royal Malaysian Customs.
To apply for the service tax license, go to the nearest Customs branch and fill up the JKED 1 form. Now you can apply for your service tax license online!
Go to E-lesen (http://elesen.customskl.gov.my/elesen/src/index.php?page=home). There are also categories of businesses subject to service tax under the “Important Notices” page. For further information on license, dial up +603 8882 2610.
So be sure to check with the Customs to see whether your business is actually liable to pay service tax or not. Among the businesses which confirm have to pay service tax are:
- Car rental agencies (revenue >RM150k)
- Restaurant having more than 25 rooms
- Restaurants with 25 rooms or less (revenue > RM300k)
- Accounting / legal services (revenue >RM150k)
To know more visit here:
If you need further clarification do contact the Royal Malaysian Customs at
Note: They are very friendly, I once import bulk of mp3 watches from China for distribution in Malaysia and the officer is very helpful in answering my questions on whether my products are subject to import duty or not:)