Malaysia – Tax And Revenue Update January 2020.

Finance Act 2019

 

The Finance Act 2019 has been gazetted on 31 December 2019. Please refer to sections 3, 22, 27, 29, 35, 37 and 39 as to when the provisions come into operation.

 

Income tax

 

The Income Tax (Amendment) Act 2019 has been gazetted on 31 December 2019 and has come into operation on 1 January 2020.

 

The Income Tax (Deduction from Remuneration) (Amendments) Rules
2019 have been gazetted on 30 December 2019 and have come into operation on 1 January 2020.

 

The Income Tax (Deduction for Expenditure Incurred for Provision of Approved Internship Programme) Rules 2019 have been gazetted on 31 December 2019. Please refer to Rule 2 in relation to the application of the Rules.

 

The Income Tax (Deduction for Payment of Educational Loan of Perbadanan Tabung Pendidikan Tinggi Nasional by Employers on behalf of Employees) (Amendment) Rules 2019 have been gazetted on 31 December 2019 and have effect from year of assessment 2019 until year of assessment 2022.

Further, the Inland Revenue Board of Malaysia has recently issued a new Tax Investigation Framework 2020 to replace the Tax Investigation Framework issued on 15 May 2018.

 

Petroleum income tax

 

The Petroleum (Income Tax) (Amendment) Act 2019 has been gazetted on 31 December 2019 and has come into operation on 1 January 2020.

 

Sales tax

 

The following orders and regulations have been gazetted between 26 December 2019 and 31 December 2019 (both dates inclusive) and have come into operation on 1 January 2020:

 

1. Sales Tax (Rates of Tax) (Amendment) Order 2019;

2. Sales Tax (Person Exempted from Payment of Tax) (Amendment) (No. 2) Order 2019;

3. Sales Tax (Amendment) Regulations 2019;

4. Sales Tax (Imposition of Sales Tax in respect of Designated Areas) (Amendment) (No. 2) Order 2019;

5. Sales Tax (Compounding of Offences) (Amendment) Regulations 2019;

6. Sales Tax (Customs Ruling) (Amendment) Regulations 2019.

 

Service tax

 

The following orders and regulations have been gazetted on 31 December 2019 and have come into operation on 1 January 2020:

 

1. Service Tax (Persons Exempted from Payment of Tax) (Amendment) Order 2019;

2. Service Tax (Digital Services) (Amendment) Regulations 2019;

3. Service Tax (Imposition of Tax for Taxable Service in respect of Designated Areas and Special Areas) (Amendment) (No. 2) Order 2019;

4. Service Tax (Customs Ruling) (Amendment) Regulations 2019.

 

The Royal Malaysian Customs Department has recently published the following Service Tax Policies on 1 January 2020 on its MySST website:

 

1. Service Tax Policy on Expansion of Scope of Taxable Service (Service Tax Policy No. 1/2020);

2. Service Tax Policy on Service Tax Exemption on Imported Taxable Service (Service Tax Policy No. 2/2020);

3. Service Tax Policy on Claiming a Refund by Offsetting Method on Service Tax on Imported Digital Service Provided by Foreign Registered Person (Service Tax Policy No. 3/2020);

4. Service Tax Policy on Service Tax on Online Distance Learning Services (Service Tax Policy No. 4/2020);

5. Service Tax Policy on Service Tax on Online Newspaper, Online Journals and Periodicals (Service Tax Policy No. 5/2020);

6. Service Tax Policy on Service Tax Treatment on Provision of Training and Coaching Services for Disabled Person (Service Tax Policy No. 6/2020).

 

Sales tax & service tax

 

A revised version of the Specific Guide on Customs Ruling (as at 2 December 2019) has also been published on the Royal Malaysian Customs Department’s MySST website.

 

Customs duty

 

The following regulations and order have been gazetted on 31 December 2019 and have come into operation on 1 January 2020:

 

1. Customs Regulations 2019;

2. Customs (Customs Ruling) (Amendment) Regulations 2019;

3. Customs Duties (Pangkor) Order 2019.

 

Excise duty

 

The following regulations and orders have been gazetted on 31 December 2019 and have come into operation on 1 January 2020:

 

1. Excise (Customs Ruling) (Amendment) Regulations 2019;

2. Excise (Determination of Value of Locally Manufactured Goods for the Purpose of Levying Excise Duty) Regulations 2019;

3. Excise (Bottling and Movement of Intoxicating Liquors) (Amendment) Regulations 2019;

4. Excise (Sale of Intoxicating Liquors) (Amendment) Regulations 2019;

5. Excise (Sale by Retail of Intoxicating Liquors by Chemists) (Amendment) Order 2019;

6. Excise (Amendment) (No. 2) Regulations 2019;

7. Excise Duties (Pangkor) Order 2019. 

 

 

For further information, please contact:

 

Abhilaash Subramaniam, Shearn Delamore & Co​

abhi@shearndelamore.com