Wednesday 17 Apr 2024
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KUALA LUMPUR (March 13): Tourism, Arts, and Culture Minister Datuk Seri Tiong King Sing has urged the Ministry of Finance (MOF) to reveal the details on the implementation of high-value goods tax (HVGT) soon.

Speaking at the Parliament, Tiong pointed out that he hopes for clarity on the new tax scheme, particularly regarding the Tourist Refund Scheme, noting it should be implemented in a transparent and efficient manner.

The HVGT, formerly known as luxury goods tax, is slated to be implemented on May 1 this year — less than two months from now. The tax rate is in the range of 5% to 10%.  

The new tax was first announced in the revised National Budget 2023 that was tabled in February last year.

It is understood that the government already has numerous dialogues with retail industry players; however, no final decisions have been reached.

Currently, there is scant detail on the tax scheme. The government has yet to come out with the definition of “high value goods” and the price range of the items that are subjected to the tax.

This has left retailers in the dark for a year.

On Feb 29, the MOF had in a written parliamentary reply on the HVGT said the bill relating to the proposed tax is scheduled to be tabled in the current Parliament sitting.

And the MOF reaffirmed that if the bill is approved, the legislation is proposed to come into force on May 1.

The government expects to earn an additional RM700 million a year from the proposed HVGT.

Roughly two weeks ago, the government sent a shock wave to the business community as it widened the scope of the 8% service tax and brought forward the effective date. The announcements were made within 72 hours prior to the effective date.

Tax consultants were also caught off-guard by the announcement.  

This has drawn criticism from the business community, as the short notice of a wider tax scope has caused confusion and disruption to business operations.

For more Parliament stories, click here.

Edited ByLee Weng Khuen & Kathy Fong
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