Sales Tax (Amendment) 1

LAWS OF MALAYSIA

Act A1671

SALES TAX (AMENDMENT) ACT 2022

2 Laws of Malaysia Act A1671

Date of Royal Assent ... ... 8 October 2022

Date of publication in the ... ... 18 October 2022

Gazette

Publisher’s Copyright C
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 Sales Tax (Amendment) 3

LAWS OF MALAYSIA

Act A1671

SALES TAX (AMENDMENT) ACT 2022

An Act to amend the Sales Tax Act 2018.

[ ]

ENACTED by the Parliament of Malaysia as follows:

Short title and commencement

1. (1) This Act may be cited as the Sales Tax (Amendment)

Act 2022.

(2) This Act comes into operation on a date to be appointed

by the Minister by notification in the Gazette and the Minister
may appoint different dates for the coming into operation of
different parts or different provisions of this Act.

(3) Notwithstanding subsection (2), the Minister may,

by notification in the Gazette, appoint the effective date for the
charging and levying of sales tax on low value goods under
this Act.
4 Laws of Malaysia Act A1671

New Part IIIa

2. The Sales Tax Act 2018 [Act 806], which is referred to as

the “principal Act” in this Act, is amended by inserting after
Part III the following part:

“Part IIIa

IMPOSITION OF SALES TAX ON LOW VALUE GOODS

Interpretation

11a. For the purposes of this Part and any regulations made
under this Act in relation to this Part—

“low value goods” means any prescribed goods or class

of goods outside Malaysia which are sold at a price not
more than a prescribed amount and brought into Malaysia in
the manner as prescribed;

“seller” means a person, whether in or outside Malaysia, who

sells low value goods on an online marketplace or operates
an online marketplace for the sales and purchase of low value
goods;

“registered seller” means any seller who is registered under

section 13.

Application

11 b . (1) The provisions of this Act, except as otherwise

provided in this Part and subject to the modifications in the
Schedule, shall apply to low value goods.

(2) Parts VIII, IX, IX a and XIII, and sections 3, 14,

15, 16, 23, 32, 35, 36, 37, 40, 41a, 43, 44, 45, 46, 47, 57a,
76 and 96 shall not apply to low value goods.

Territorial and extra-territorial application

11c. (1) This Part shall apply both within and outside Malaysia.
 Sales Tax (Amendment) 5

(2) Notwithstanding subsection (1), this Part shall apply to

any person, whatever his nationality or citizenship, beyond
the geographical limits of Malaysia and the territorial waters
of Malaysia, if the person—
(a) is a seller; or
(b) is registered under section 13 as a registered seller.

Display of information on package

11d. Every registered seller shall furnish to the Director General

prescribed particulars which shall be displayed on the package
of low value goods in the manner as may be prescribed.”.

Amendment of section 19

3. Section 19 of the principal Act is amended by inserting after

subsection (4) the following subsection:

“(5) The Director General may, on the application of

a registered manufacturer, cancel the registration of the registered
manufacturer if the registered manufacturer has been exempted
from registration pursuant to subsection 20(1).”.

New of section 57a

4. The principal Act is amended by inserting after section 57

the following section:

“Deficiency in quantity of taxable goods in a special area

57a. (1) If it appears to the Director General at any time

that in a special area there is a deficiency in the quantity
of taxable goods which in normal circumstances ought to be
found therein, any person being or holding himself out to be
the owner, agent or person in possession of, or beneficially
interested in, or having any control of, or power of disposition
over, the goods shall—
(a) in the absence of proof to the contrary, be presumed
to have illegally transported such goods to Malaysia;
and
6 Laws of Malaysia Act A1671

(b) be liable to pay the sales tax leviable on the date when
the quantity of the goods were found to be deficient
as if the goods were imported into Malaysia.

(2) Notwithstanding subsection (1), if it is shown to

the satisfaction of the Director General that such deficiency has
been caused by any unavoidable leakage, breakage or other
accident, the Director General may remit the whole or part of
the sales tax leviable on the goods found deficient.”.

Amendment of section 91

5. Section 91 of the principal Act is amended in paragraph (a)

by inserting after the words “being an employee of a taxable
person” the words “, an employee under section 89”.

Amendment of section 106

6. Section 106 of the principal Act is amended in subsection (2)—

(a) in paragraph (a), by substituting for the words “registration
of manufacturers” the words “registration of manufacturers
and sellers”;
(b) in paragraph (c), by substituting for the words “taxable
goods” the words “the taxable goods and low value
goods”; and
(c) by inserting after paragraph (k) the following paragraph:
“(ka) all matters relating to low value goods;”.

New sections 106a and 106b

7. The principal Act is amended by inserting after section 106

the following sections:

“Power to extend period

106a. Where, by this Act, a period is specified within which

an act or thing is to be done by a person, and the Minister
is satisfied that the act or thing could not be completed in
that period due to the occurrence of public emergency or
public health crisis, the Minister may, upon such terms and
conditions as the Minister thinks fit, extend the period for
the completion of the act or thing before the expiration of
the period.
 Sales Tax (Amendment) 7

Power to modify terms and conditions

106 b . (1) Where terms and conditions are imposed

pursuant to this Act, the Minister may, on the advice of the
Director General, from time to time modify the terms and
conditions for the purpose of carrying out the objects of this
Act.

(2) Before modifying the terms and conditions, notice must

be given to the person bound by the terms and conditions
stating—
(a) the terms and conditions as modified; and
(b) the date the terms and conditions as modified
take effect.

(3) The modified terms and conditions shall not take effect
in less than fourteen days from the date the notice is issued
under subsection (2).

(4) For the purposes of this section, “modify” means

add to, delete or vary.”.

New schedule

8. The principal Act is amended by inserting after section 109

the following schedule:

“Schedule

[Section 11b]

MODIFICATIONS TO THE PROVISIONS OF THE SALES TAX ACT 2018

WHICH APPLY TO LOW VALUE GOODS

(1) (2)
Provisions of this Act Modifications

Section 2 In the definition of “taxable person”, substitute for the

words “a registered manufacturer or a manufacturer”
the words “a registered seller or a seller”.
8 Laws of Malaysia Act A1671
(1) (2)
Provisions of this Act Modifications

Section 8 Substitute for section 8 the following section:

“Imposition and scope of sales tax

8. (1) Sales tax shall be charged on low value

goods sold by a taxable person.

(2) The Minister may, by order published in the

Gazette, determine low value goods based on the
following criteria:
(a) goods or class of goods;
(b) the price of goods; and
(c) the manner in which the goods are brought
into Malaysia.

(3) Any order made under subsection (2) shall

be laid before the Dewan Rakyat.

(4) This Act shall be construed as one with

the Customs Act 1967 and the Excise Act 1976 with
regard to the goods brought into Malaysia including
goods in transit and the movement of goods under
customs control or excise control.

(5) Where there is any inconsistency between

the provisions of the Customs Act 1967 or
the Excise Act 1976 and the provisions of this Act,
the provisions of this Act shall prevail.”.

Section 9 Substitute for section 9 the following section:

“Determination of sale value of low value goods

9. The sale value of low value goods on which

sales tax is payable shall be the price of low value
goods not including any tax, fee or other charges
imposed on the low value goods.”.

Section 10 1. In subsection (1)—

(a) substitute for the words “the taxable goods
sold, used or disposed of or imported” the
words “the low value goods sold”; and
(b) substitute for the words “the sale value of the
taxable goods” the words “the sale value of
the low value goods”.

2. Delete subsections (4), (5) and (6).

 Sales Tax (Amendment) 9
(1) (2)
Provisions of this Act Modifications

Section 11 Substitute for section 11 the following section:

“Sales tax due

11. The sales tax chargeable under section 8 shall

be due at the time when the low value goods are
sold by the taxable person.”.

Part IV 1. Substitute for the words “taxable goods” the words

(except as “low value goods”.
otherwise
provided) 2. Substitute for the word “manufacturer” the word
“seller”.

3. Substitute for the words “registered manufacturer”

the words “registered seller”.

4. Substitute for the word “manufacture” the word

“sell”.

Section 12 1. In paragraph 3(b), substitute for the words

“ t h e m a n u f a c t u r e r ’s r e g i s t r a t i o n ” t h e w o r d s
“the seller’s registration”.

2. Delete subsection (4).

Section 17 Substitute for the word “manufacturing” the word

“selling”.

Section 18 Substitute for the words “section 13 or 14” the words

“section 13”.

Section 19 1. In subsection (1), substitute for the words

“the manufacturer’s registration” the words “the seller’s
registration”.

2. Substitute for subsection (3) the following subsection:

“(3) Where the Director General is satisfied

that on the date on which a seller was registered
under section 13, the seller was not liable
to be registered under section 12 or has ceased
to sell low value goods, the Director General
may cancel the registration of the seller with
effect from the date as determined by the
Director General in the notification in writing
to such seller.”.

3. Delete subsection (4).

10 Laws of Malaysia Act A1671
(1) (2)
Provisions of this Act Modifications

Part V 1. Substitute for the words “taxable goods” the words

(except as “low value goods”.
otherwise
provided) 2. Substitute for the word “manufacturer” the word
“seller”.

3. Substitute for the words “registered manufacturer”

the words “registered seller”.

4. Substitute for the word “manufacture” the word

“sell”.

Section 21 1. Substitute for the shoulder note the following

shoulder note:

“Invoice and document”.

2. In subsection (1), substitute for the words

“an invoice” the words “an invoice or any document”.

3. In subsection (2), substitute for the words

“No invoice” the words “No invoice or document”.

Section 22 1. Substitute for the shoulder note the following

shoulder note:

“Production of invoice or document by computer”.

2. Substitute for the words “For the purposes of

any provision under this Act relating to an invoice,
a registered manufacturer shall be treated as having
issued an invoice to a purchaser” the words “For the
purposes of any provision under this Act relating to an
invoice or a document issued under subsection 21(1),
a registered seller shall be treated as having issued
an invoice or a document under subsection 21(1)
to a purchaser”.

Section 24 1. Substitute for subsection (1) the following subsection:

“(1) Each taxable person shall keep up to

date complete and true written records of all
transactions which affect or may affect his
liability to sales tax.”.
 Sales Tax (Amendment) 11
(1) (2)
Provisions of this Act Modifications

2. Substitute for subsection (2) the following subsection:

“(2) Any record kept under this section shall

be preserved for a period of seven years from
the latest date to which the record relates.”.

3. Delete subsection (4).

4. In subsection (6), substitute for the words

“subsection (1), (2), (3) or (4)” the words “subsection (1),
(2) or (3)”.

Section 25 1. In subsection (1), substitute for the words

“two months” the words “three months”.

2. Delete subsection (2).

3. In subsection (5), substitute for the words

“subsection (1), (2) or (4)” the words “subsection (1)
or (4)”.

Section 26 1. Delete subsection (4).

2. In subsection (6), substitute for the words

“subsections (1), (2), (3) and (4)” the words
“subsections (1), (2) and (3)”.

3. In subsection (7), substitute for the words

“subsection (1), (2), (3) or (4)” the words
“subsection (1), (2) or (3)”.

Section 27 1. Delete subsections (4), (5) and (6).

2. In subsection (8), substitute for the words

“under subsection (1), (2), (4), (6) or (7)” the words
“under subsection (1), (2) or (7)”.

3. In subsection (9), substitute for the words

“under subsection (1), (2), (6) or (8)” the words
“under subsection (1), (2) or (8)”.

Section 28 1. Substitute the words “the invoice” the words

“the invoice or document”.
12 Laws of Malaysia Act A1671
(1) (2)
Provisions of this Act Modifications

2. In subsection (2), substitute for the words

“an invoice” the words “an invoice or a document”.

3. In subsection (3), substitute for the words

“is an invoice” the words “is an invoice or a document”.

Section 29 Delete subsection (2).

Section 31 In subsection (3), insert after the words “registered post”

the words “or by electronic means”.

Section 33 Substitute for section 33 the following section:

“Low value goods subject to customs or excise

control not to be delivered until sales tax has
been paid in full

33. Where it appears to an officer of sales tax

that the sales tax on the low value goods—

(a) has not been charged;

(b) has been charged at a rate lower than the

rate as fixed under section 10; or

(c) has not been paid,

no person shall be entitled to obtain delivery

of such low value goods from customs control
or excise control until the amount of sales tax on
the low value goods under paragraph (a), (b) or (c)
has been paid in full.”.

Part VI Substitute for the words “registered manufacturer”

(except as the words “registered seller”.
otherwise
provided)

Section 35a In subsection (1), substitute for the words “refund of sales
tax under paragraph 35(3)(c) or has made a deduction under
section 23 or 41a” the words “refund of sales tax under
section 39”.
 Sales Tax (Amendment) 13
(1) (2)
Provisions of this Act Modifications

Section 39 Substitute for subsections (1) and (2) the following

subsections:

“(1) The refund of whole or any part of the amount of

sales tax, which has been paid to the Director General by
the registered seller, may be made or claimed under
prescribed circumstances.

(2) Notwithstanding subsection (1), the Director

General may withhold the whole or any part of the
amount to be refunded under subsection (1) to be
credited to any following or subsequent taxable
period and the Director General shall treat the amount
credited as payment or part payment received from
the registered seller.”.

Section 62 In subsection (3), substitute for the words “require

the supplier or, on the supplier’s default” the words
“require the seller or, on the seller’s default”.

Section 64 1. Substitute for the words “manufacturer or importer”

the words “manufacturer, importer or seller”.

2. Substitute for the words “taxable goods” the words

“low value goods”.

Section 69 In subsection (1), substitute for the words “section 13

and 14” the words “section 13”.

Section 70 In subsection (1), substitute for the words

“taxable goods” the words “low value goods”.

Section 74 1. In paragraph (1)(a), substitute for the word

“manufacturer” the word “seller”.

2. I n p a r a g r a p h ( 1 ) ( e ) , d e l e t e t h e w o r d s
“or customs ruling is made under section 43”.

Section 83 In paragraph (c), substitute for the words

“taxable goods” the words “low value goods”.
14 Laws of Malaysia Act A1671
(1) (2)
Provisions of this Act Modifications

Part XII 1. Substitute for the words “taxable goods” the words
(except as “low value goods”.
otherwise
provided) 2. Substitute for the word “manufacturer” the word
“seller”.

3. Substitute for the words “registered manufacturer”

the words “registered seller”.

4. Substitute for the word “manufacture” the word

“sell”.

Section 86a 1. Substitute for the shoulder note the following

shoulder note:

“Evasion of sales tax on low value goods”.

2. In subsection (1), substitute for the words

“importation of taxable goods” the words “low value
goods sold”.

Section 88 Substitute for the words “section 10, 36 or 39”

the words “section 39”.

Section 88a Substitute for the words “section 23, 35 a or 41 a ”

the words “section 35a”.

Section 98 In subsection (1), substitute for the words “the taxable

goods that have been sold, manufactured, purchased
or acquired” the words “the low value goods that
have been sold”.

Section 99 1. Substitute for the shoulder note the following

shoulder note:

“Registered seller to submit audit certificate”.

2. Substitute for the words “the registered manufacturer’s

production and sale of taxable goods manufactured”
the words “low value goods sold”.”.
 Sales Tax (Amendment) 15

Transitional provisions

9. (1) Notwithstanding subsection 12(2) and section 13 of

the principal Act as modified by this Act, a seller who sells low value
goods before the effective date of for the charging and levying
of sales tax on low value goods shall, on the date of coming
into operation of this Act, apply to the Director General to be
registered as a registered seller if there are reasonable grounds
for believing that the total sale value of his low value goods in
the month of coming into force of this Act and eleven months
immediately succeeding the month will exceed the total sale
value of low value goods determined under subsection 12(1) of
the principal Act as modified by this Act.

(2) Where goods are purchased before the effective date for
the charging and levying of sales tax on low value goods and
the goods are low value goods from the date of coming into
operation of this Act, no sales tax shall be charged or levied on
the goods even though the goods are delivered to Malaysia after
the effective date.

Things done in anticipation of the enactment of this Act

10. All acts and things done by or on behalf of the Director General
in preparation for or in anticipation of the enactment of
this Act and any expenditure incurred in relation thereto shall
be deemed to have been authorized under this Act, provided that
the acts and things done are consistent with the general intention
and purposes of this Act, and all rights and obligations acquired
or incurred as a result of the doing of those acts or things
including any expenditure incurred in relation thereto shall upon
the coming into operation of this Act be deemed to be the rights
and obligations of the Director General.