The Government Has Announced Another Four GST Zero-Rated Services

Last month, Malaysians were shocked to learn that the Goods and Services Tax (GST) will be imposed on 60 food items including potatoes, long beans, bihun, kuay teow, and spinach.

The announcement was met with some pretty major backlash from Malaysians as some of the items listed were actually basic food necessities. A few hours later, the government announced the cancellation of the tax. Phew, thank goodness!

On Wednesday, The Star reported that Prime Minister, Datuk Seri Najib Tun Razak has announced some good news related to the GST – four services will be treated as GST zero-rated supply.

The announcement was posted on his blog, najibrazak.com.

The new status will commence effective 1 July.

The first service to be listed zero-rated is the exporting of goods.

"Firstly, prescribed services performed in connection with goods for export where the service is supplied to overseas customers,” he said in the statement.

“Secondly, prescribed services supplied in the Free Zones, including Licensed Manufacturing Warehouses (LMW), to overseas customers.”

Another two services that are included are research and development services provided for overseas customers and non-recurring expenditures incurred as engineering expenses including tools and machinery used in the manufacturing process of goods.

We hope there will be more positive announcements regarding GST soon.