kpmg malaysia - tax highlights from your advisers amendments to excise... · 2020. 4. 2. ·...
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© 2020 KPMG Tax Services Sdn. Bhd., a company incorporated under Malaysian law and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 0
Tax WhizTax highlights from your advisers
KPMG in Malaysia
2 April 2020
Amendments to Excise Duties, Customs Duties and Sales Tax Exemptions
Conditions to purchase duty free goods at the international airportsin Malaysia
© 2020 KPMG Tax Services Sdn. Bhd., a company incorporated under Malaysian law and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 1
Tax Whiz 2020 | Amendments to Excise Duties, Customs Duties and Sales Tax Exemptions
Amendments to Excise Duties, Customs Duties and Sales Tax Exemptions
The above amendments are in relation to persons entering Malaysia who are granted exemption from payment of Excise Duties, Customs Duties and Sales Tax on goods imported and purchased from any duty free shops at the international airports in Malaysia.
Amongst others, for purchases from the duty free shops, the total value of goods is increased from RM500 to RM1,000 and the minimum time frame for a visitor to visit Malaysia or for a Malaysia resident to be absent from Malaysia is reduced from 72 hours to 48 hours.
We set out in the following page a summary of the key amendments.
The following Orders have been gazetted to effect the amendments to the conditions to purchase duty free goods at the international airports in Malaysia: -
Excise Duties (Exemption) 2017 (Amendment) Order 2020
Customs Duties (Exemption) 2017 (Amendment) (No. 2) Order 2020
Sales Tax (Persons Exempted from Payment of Tax) (Amendment) Order 2020
These Orders come into operation on 1 April 2020.
Please click here for a copy of the Orders at the at the official portal of e-Federal Gazette
Excise Duties, Customs Duties and Sales Tax Exemptions Amendment Orders
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Tax Whiz 2020 | Amendments to Excise Duties, Customs Duties and Sales Tax Exemptions
For a person entering Malaysia (other than Labuan, Langkawi, Tioman and Pangkor)
Amendments Excise Duties Customs Duties Sales Tax
The total value of goods* exempted
Not applicable Limited to RM500 for any mode of travelling other than air mode
Limited to RM1,000 through air mode
Limited to RM500 for goods imported
Increased from RM500 to RM1,000 for goods purchased from duty free shop at the international airports
Goods exempted The prescribed goods are imported and purchased from any duty free shops at the point of entry or the international airports
Goods that are already prescribed to be exempted from Sales Tax (i.e. non taxable) are removed
Minimum time frame requirement for a visitor to visit Malaysia or for a Malaysia resident to be absent from Malaysia
72 hours for any mode of travelling other than air mode
48 hours through air mode
72 hours at the time he imports the goods from other country
Reduced to 48 hours at the time he purchases the goods from a duty free shop at the international airport
Imports or purchases in excess of the quantity or value of goods are exempted
The person is liable to pay Excise Duties on the excess only based on the prevailing rate imposed
Either at the prevailing rate or a 10% ad valorem rate on the excess.
Instead of a flat rate of 10% ad valorem, the person is liable to pay Sales Tax on the excess only based on the prevailing rate imposed
* These are goods other than those currently exempted under the respective prescribed threshold such as alcohol, tobacco, apparels, footwear, food preparations and electrical or battery-operated appliances for personal care and exclude tyres and tubes.
© 2020 KPMG Tax Services Sdn. Bhd., a company incorporated under Malaysian law and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 3
Tax Whiz 2020 | Amendments to Excise Duties, Customs Duties and Sales Tax Exemptions
For a person entering Malaysia from Labuan, Langkawi, Tioman and Pangkor
Amendments Excise Duties Customs Duties Sales Tax
The total value of goods* exempted
Not applicable Increased from RM500 to RM1,000
Increased from RM500 to RM1,000
Goods exempted No amendment No amendment Goods that are already prescribed to be exempted from Sales Tax (i.e. non taxable) are removed
Additional condition The goods are purchased from Labuan, Langkawi, Tioman or Pangkor
The goods are purchased from Labuan, Langkawi, Tioman or Pangkor
The goods are purchased and transported on or in the baggage of the person
The goods are transported on or in the baggage of the person
Minimum time spent in Pangkor
No amendment No amendment “Designated area” now includes Pangkor
The person must have visited Pangkor for a period of not less than 48 hours
Imports/ transports in excess of the quantity or value of goods are exempted
No amendment No amendment Instead of a flat rate of 10% ad valorem, the person is liable to pay Sales Tax on the excess only based on the prevailing rate imposed
* These are goods other than those currently exempted under the respective prescribed threshold such as alcohol, tobacco, apparels, footwear, food preparations and electrical or battery-operated appliances for personal care and exclude tyres and tubes.
© 2020 KPMG Tax Services Sdn. Bhd., a company incorporated under Malaysian law and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 4© 2020 KPMG Tax Services Sdn. Bhd., a company incorporated under Malaysian law and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 4
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© 2020 KPMG Tax Services Sdn. Bhd., a company incorporated under Malaysian law and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 5© 2020 KPMG Tax Services Sdn. Bhd., a company incorporated under Malaysian law and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 5
Tax Whiz 2020 | Amendments to Excise Duties, Customs Duties and Sales Tax Exemptions
© 2020 KPMG Tax Services Sdn. Bhd., a company incorporated under Malaysian law and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.
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