1. Lower Income Tax Rates for 2015 and 2. Introduction of GST

Gravitas · 2014-07-29T05:29:08+02:00

The GOOD news. The income tax rates are being reduced in 2015 and a comparison of the 2014 and 2015 rates can be found here:Comparison of Income Tax Rates 2014 and 2015Basically this means:Tax steps on annual salary are: 2014 20150-5,000 0% 0%5,001-10,000 2% (RM100) 5,000-10,000 1%10,001-20,000 2% (RM100) 10,001-20,000 1%20,001-35,000 6% (RM300) 20,001-35,000 5%35,001-50,000 11% (RM1,200) 35,001-50,000 10%50,001-70,000 19% (RM2,850) 50,001-70,000 16%70,001-100,000 24% (RM6,650) 70,001-100,000 21%Exceeding 100k 26% 100,001-250,000 24% 250,001-400,000 24.5% Exceeding 400 000 25%NOTE: Non-resident individuals are subject to income tax at a fixed rate of 25%, reduced by 1% from current 26%.GSTA new tax is going to be introduced that will replace the current Sales (10%) and Service (6%) Taxes, which will no longer be charged. It is called GST (Goods and Services Tax). GST will be implemented on 1 April 2015 and the standard rate of GST is fixed at 6%. Certain essential goods and services will be exempted from GST. List of Zero-Rated Supply Agricultural products - paddy, fresh or chilled vegetables, certain provisionally preserved vegetables Essential foodstuff - rice, sugar, flour, cooking oil, vegetable, fish and meat, eggs oils, salt, flour, etc Livestocks and livestock supplies or poultry - live animals and unprocessed meat Eggs Fish - live, fresh, frozen and dried First 200 units of electricity for domestic use Water for dosmestic users Goods supplied to designated areas from Malaysia Labuan, Langkawi & Tioman Exported goods Exported services - for example, archiecture services in connection with land outside Malaysia Services in Malaysia - for example, pilotage, salvage or towage services International services - for example, transport of passengers or goods from a place in Malaysia to a place outside MalaysiaList of Exempt Supply Financial Services Public Transport Services Private Education Services Tolled Highways or Bridges Childcare Services Funeral, Burial and Cremation Services Private Healthcare Services Supplies Made by Societies Residential Land or Building Agriculture or General Use LandPublic Transport Services Under Exempt Supply Mass public transport by rail (LRT, ERL, MRT, Monorail, etc) Ships or Boats Ferries Express bus Workers bus School bus Feeder bus TaxiLand, Building and Lease of Property Under Exempt Supply Goods - Land used for residental or agricultural purposes or general use (for example, burial ground, playground or religious building) Goods - Building used for residential purposes Services - Right to use or license to occupy residential property (land or building or both) Services - Right to use or license to occupy land for agricultural purposes or general use (government building, burial ground, schools, playground, parks, etc.)All owners of businesses must register before 31st December 2014 and SMEs will receive a RM1.000 subsidy for purchasing software required to calculate the tax.Subsidy for SMEs..

Gravitas ViP

9040POSTS

11 years ago

The GOOD news.聽

The income tax rates are being reduced in 2015 and a comparison of the 2014 and 2015 rates can be found here:

Basically this means:

Tax steps on annual salary are:
聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽 2014聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽2015
0-5,000聽聽聽聽聽聽聽聽聽聽 0%聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽0%
5,001-10,000聽聽聽聽聽聽2% (RM100)聽聽聽聽聽聽聽5,000-10,000聽聽聽 1%
10,001-20,000聽聽聽聽聽2% (RM100)聽聽聽聽聽聽聽10,001-20,000聽聽 1%
20,001-35,000聽聽聽聽聽6% (RM300)聽聽聽聽聽聽聽20,001-35,000聽聽 5%
35,001-50,000聽聽聽聽11% (RM1,200)聽聽聽聽聽 35,001-50,000聽聽10%
50,001-70,000聽聽聽聽19% (RM2,850)聽聽聽聽聽 50,001-70,000聽聽16%
70,001-100,000聽聽聽24% (RM6,650)聽聽聽聽聽70,001-100,000聽聽21%
Exceeding 100k聽聽聽26%聽聽聽聽聽聽聽聽聽聽聽聽聽 100,001-250,000聽 24%
聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽250,001-400,000聽 24.5%
聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽聽 Exceeding 400 000聽 25%

NOTE: Non-resident individuals are subject to income tax at a fixed rate of 25%, reduced by 1% from current 26%.

GST

A new tax is going to be introduced that will replace the current Sales (10%) and Service (6%) Taxes, which will no longer be charged. It is called GST (Goods and Services Tax). GST will be implemented on 1 April 2015 and the standard rate of GST is fixed at 6%. Certain essential goods and services will be exempted from GST.

List of Zero-Rated Supply
聽聽 Agricultural products -聽 paddy, fresh or chilled vegetables, certain provisionally preserved vegetables
聽聽 Essential foodstuff -聽 rice, sugar, flour, cooking oil, vegetable, fish and meat, eggs oils, salt, flour, etc
聽聽 Livestocks and livestock supplies or poultry - live animals and unprocessed meat
聽聽 Eggs
聽聽 Fish - live, fresh, frozen and dried
聽聽 First 200 units of electricity for domestic use
聽聽 Water for dosmestic users
聽聽 Goods supplied to designated areas from Malaysia聽 Labuan, Langkawi & Tioman
聽聽 Exported goods
聽聽 Exported services - for example, archiecture services in connection with land outside Malaysia
聽聽 Services in Malaysia - for example, pilotage, salvage or towage services
聽聽 International services - for example, transport of passengers or goods from a place in Malaysia to a place outside Malaysia

List of Exempt Supply
聽聽 Financial Services
聽聽 Public Transport Services
聽聽 Private Education Services
聽聽 Tolled Highways or Bridges
聽聽 Childcare Services
聽聽 Funeral, Burial and Cremation Services
聽聽 Private Healthcare Services
聽聽 Supplies Made by Societies
聽聽 Residential Land or Building
聽聽 Agriculture or General Use Land

Public Transport Services Under Exempt Supply
聽聽 Mass public transport by rail (LRT, ERL, MRT, Monorail, etc)
聽聽 Ships or Boats
聽聽 Ferries
聽聽 Express bus
聽聽 Workers bus
聽聽 School bus
聽聽 Feeder bus
聽聽 Taxi

Land, Building and Lease of Property Under Exempt Supply
聽聽 Goods - Land used for residental or agricultural purposes or general use (for example, burial ground, playground or religious building)
聽聽 Goods - Building used for residential purposes
聽聽 Services - Right to use or license to occupy residential property (land or building or both)
聽聽 Services - Right to use or license to occupy land for agricultural purposes or general use (government building, burial ground, schools, playground, parks, etc.)

All owners of businesses must register before 31st December 2014 and SMEs will receive a RM1.000 subsidy for purchasing software required to calculate the tax.

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2 members reacted to this post

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Gravitas ViP

9040POSTS

11 years ago

For me the logic would be that anything that now has ++ added (sales tax at 10% and service tax at 6%) should actually not have the 16% added and only the new 6% GST.聽

Service outlets are supposed to pass on the sales tax now in tax to the Government, but dont have to do so if they have an annual turnover of RM 350 000.聽 So I guess the Government is trying to tighten up on tax and decided to have a more easy to monitor GST tax "to stop leakage" as they put it.聽

To be honest, when I look at the zero rated and exempt items, I cant see that I will have to pay more unless I want to purchase "luxurious" items. The cost of clothing and shoes may go up though.

I actually hope to see a drop in prices in some quarters e.g. restaurants and bars (only GST (6%) and not ++ added to the bill). But lets hope they dont just up their prices and pocket the 10% themselves..... Hopefully the Government will stop that happening.

The other effect may be that service providers will stop employing so many foreign workers, as they can no longer pay their salaries from the ++ they take from their customers and clients.

1 member reacted to this post

carlyle1979 Serial expat

440POSTS

11 years ago

This is really useful. Thanks for sharing Gravitas.

The Kuala Lumpur expat guide

Comprehensive and free

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Gravitas ViP

9040POSTS

11 years ago

I have noticed that a restaurant and bar I went to now has prices that are shown as being all inclusive of taxes and bills are not broken down.

I was told this is a new requirement. But as we can all imagine, that will mean that prices will not change when GST is introduced.聽 The consumer will not benefit from any reduction as the taxation will be adjusted "behind the scenes".