Budget 2014: GST on April 1, 2015 at 6% (update 1)

KUALA LUMPUR: With the inflation rate currently at a low 2%, the Government believes now is the best time to implement the Goods and Services Tax. 

According to the Prime Minister, with the implementation of GST, the Government would be be able to address the weaknesses in the current taxation system. 

The GST rate is fixed at 6% and to be effective from Apr 1 2015, approximately 17 months from today.

Sale, purchase and rental of residential properties as well as selected financial services are exempted from GST.

To ensure smooth implementation of GST by businesses, the Government proposes the following additional packages: 

First, corporate income tax rate be reduced by 1 percentage point from 25% to 24%. Whereas income tax rate for small and medium companies will be reduced by 1 percentage point from 20% to 19% from the year of assessment 2016;