Service tax for logistics and digital services gazetted


PETALING JAYA: The service tax, including for logistics and digital services, which was announced in Budget 2024 has been gazetted.

According to the Service Tax (Rate of Tax) Amendment Order signed off by Finance Minister II Datuk Seri Amir Hamzah Azizan, a 6% tax will be imposed.

As far as logistics services are concerned, a separate gazette noted that the total value of taxable service is set at RM500,000.

Goods including courier services of documents, packages or goods originating from a place outside of Malaysia headed to another place outside the country, those with the last point of exit within Malaysia to a place outside Malaysia, are exempted from the tax.

Similarly, goods that arrive at the Malaysian port or airports for the purposes of transfer or unloading from an aircraft or vessel to another aircraft or vessel before it is transported out of the country will also be exempted.

“Provision of all delivery, distribution or transportation of goods and services including courier services of documents packages or goods through the e-commerce platform including on behalf of any person, except delivery of food and beverages, provided by a taxable person specified in column (1) of Group B,” read the gazette.

Apart from that, karaoke centres and repair and maintenance services will also be subject to the service tax, along with brokering and underwriting services except medical insurance or medical takaful borne by an individual, life insurance policies or family takaful certificates or matters related to goods, land or any other matters outside Malaysia.

Separately, another gazette called the Service Tax (Rate of Digital Services Tax) (Amendment) Order 2024 was also unveiled, with the order coming into effect on March 1, 2024.

“Any digital service provided before the date of coming into operation of this Order and the provision of the digital service spanning after the date of coming into operation of this Order, the service tax shall be charged at the rate of 8% of the value of the digital service charged by a foreign registered person on the proportion of the digital service which is attributed to the part of the period after the date of coming into operation of this order,” read the gazette.

“Any digital service provided on or after the date of coming into operation of this Order, any payment received before the date of coming into operation of this Order in relation to the digital service, the service tax on the payment received shall be charged at the rate of 6% of the value of the digital service charged by a foreign registered person,” it added.

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