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Malaysia rejects reintroduction of GST

Prime Minister rules out return to Goods & Services Tax to replace Sales and Services Tax

PM Anwar this week confirmed there are no plans to return to Goods & Services Tax (‘GST’). Following a review to scrap the existing Sales and Services Tax for a second time, the government has shelved the idea due to inflation fears. Instead, the short term focus will be on cutting governmental subsidies.

June 2022: Government evaluating reintroduction of Goods and Services Tax to replace Sales and Services Tax

Last year, Malaysia was facing calls to reintroduce a Goods and Services Tax to replace its turnover-based Sales and Services Taxes.  GST was first introduced in April 2015 to replace SST, but was withdrawn in July 2018 and SST reimplemented. Any GST reintroduction could happen by 2023.

In 2021, the government confirmed “A study being carried out also covers the impact on the economy, cost of living, cost of goods, as well as ability to address the shadow economy (or black market),”

This follows recommendation from the Organisation for Economic Cooperation and Development (OECD) that GST would broaden and stabilise the tax base, and help the government cope with the economic shock of the COVID-19 crisis. It would also limit the cascading – compound taxation – effect on businesses of the current irrecoverable SST.

174 countries have a VAT or GST regime.

How Malaysia fell out of love with GST the first time (2015 to 2018)

SST applies to less than 100,000 companies, but GST covered almost half a million traders, giving a more reliable and larger tax base. However, final sale-only SST was felt to be simpler to administer than mult-stage GST. GST also failed to stop the rising government debt problem – a promise for its introduction. As a result, the new GST become unpopular and was blamed for rising prices following its 2015 introduction. This led to its withdrawal in June 2018 following election commitments by Pakatan Harapan.

Future global VAT / GST changes

Date Country VAT / GST  changes (click for details)
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2023 Europe European VAT registration thresholds & Intrastat
1 Jun 2023 Slovenia Temporary energy VAT cut ends
1 Jun 2023 Egypt Digital services VAT compliance portal
1 Jun 2023 Bolivia Latest wave of e-invoicing taxpayers
1 Jun 2023 São Tomé and Príncipe Implements 15% VAT
1 Jul 2023 Saudi Arabia Wave 2 B2B e-invoicing taxpayers
1 Jul 2023 Italy Gas energy VAT cut ends
1 Jul 2023 Poland SLIM VAT 3; 20 reforms to Polish regime
1 Jul 2023 Jersey Foreign e-commerce and marketplaces into GST net
1 Jul 2023 Egypt Paper invoices phased out for e-invoices
1 Jul 2023 Kenya Removal registration threshold non-resident digital services
1 Jul 2023 Saudi Arabia Second round of mandatory e-invoicing
1 Jul 2023 Malaysia Phased introduction of e-invoicing - TBC
1 Jul 2023 Australia Peppol e-invoicing
1 Jul 2023 Philippines 12% VAT on foreign digital service providers
1 Jul 2023 US South Dakota end transaction threshold on sales tax
1 Jul 2023 US South Dakota cuts sales tax rate to 4.2%
1 Jul 2023 US Mississippi sales tax on digital services
1 Jul 2023 Canada Marketplace GST reporting of user transactions
1 Jul 2023 Guatemala Latest round of taxpayers on e-invoicing
1 Aug 2023 India New 7-day deadline for e-invoice reporting
1 Aug 2023 India Mandatory e-invoicing threshold drops to ₹5
1 Aug 2023 US Louisiana drops sales tax thresholds
1 Sep 2023 Ireland Tourism VAT rate returns to 13.5%
1 Sep 2023 Slovakia Temp 10% rate on tourism and sport now permanent
1 Oct 2023 Portugal Food VAT rate cut ends
1 Oct 2023 Saudi Arabia Wave 3 taxpayers for B2B e-invoicing
1 Oct 2023 Thailand Raises VAT to 10%
1 Oct 2023 Japan Tax qualified invoices
1 Nov 2023 EU Tourism operators margin scheme reforms proposal
1 Nov 2023 Saudi Arabia Fourth round of mandatory e-invoicing
1 Dec 2023 Saudi Arabia Fifth wave of taxpayers mandated for e-invoicing
1 Jan 2024 EU EU permissions on e-invoicing removed
1 Jan 2024 EU DAC7 first marketplace reports due
TBC 2024 EU Quick fixes - VAT in the Digital Age
1 Jan 2024 Spain Likely start of e-invoicing rollout
1 Jan 2024 Belgium VAT return rule changes
1 Jan 2024 Belgium Consolidation of reduced VAT rates
1 Jan 2024 Luxembourg VAT rate returns to 17%
1 Jan 2024 Switzerland VAT rises to 8.1%
1 Jan 2024 Germany Restaurant and catering temporary VAT cut to 7% ends
1 Jan 2024 Portugal SAF-T Accounting becomes mandatory
1 Jan 2024 Greece Ends COVID-19 temporary reduced rates
1 Jan 2024 Greece myData live invoice reporting via ERPs
1 Jan 2024 Poland SLIM VAT 4 reforms
1 Jan 2024 Czech Proposed consolidation of reduced VAT rates
1 Jan 2024 Slovakia IS EFA e-invoicing for B2B and B2C
1 Jan 2024 Romania Full mandatory B2B e-invoicing
1 Jan 2024 Lithuania VAT registration threshold rises to €65,000
1 Jan 2024 Estonia 2% VAT rise
1 Jan 2024 Israel VAT on B2C digital services by foreign providers
1 Jan 2024 Israel mandatory pre-clearance e-invoicing
1 Jan 2024 Bahrain Potential e-invoicing implementation
1 Jan 2024 UAE Potential e-invoice implementation
1 Jan 2024 SIngapore Rise of GST to 9% to 2024
1 Jan 2024 Aruba Implements 12.5% VAT
15 Jan 2024 Dominican Republic 1st wave of mandatory e-invoicing
1 Apr 2024 New Zealand 15% GST on gig and sharing economies digital platforms
1 Jul 2024 Belgium Phased B2B e-invoicing mandate
1 Jul 2024 Spain Certified electronic invoice software
1 Jul 2024 France E-invoice and e-reporting for B2B and B2C
1 Jan 2024 Poland Mandated e-invoicing introduced
1 Jul 2024 Bhutan Implementation of VAT
1 Jan 2025 EU Single VAT Registration in the EU - extension of OSS
1 Jan 2025 EU Marketplaces deemed supplier for EU sellers' VAT
1 Jan 2025 EU Accommodation & travel platforms deemed supplier for VAT
1 Jan 2025 EU EU IOSS mandated for marketplaces
1 Jan 2025 EU Call-off stock VAT simplification ends
1 Jan 2025 EU Harmonisation of B2B Reverse Charge rules
1 Jan 2025 EU Increased VAT rate setting freedoms
1 Jan 2025 EU VAT rate thresholds change foreign companies
1 Jan 2025 EU EU VAT rule changes on cross-border virtual events
1 Jan 2025 Germany Mandatory B2B e-invoicing
1 Jan 2025 Croatia Mandatory B2B e-invoicing
1 Jan 2025 Latvia B2B e-invoices mandated
1 Jan 2025 France Mid-sized taxpayers included in e-invoicing mandate
1 Jan 2025 Indonesia VAT rate to rise 1% to 12%
15 Jan 2025 Dominican Republic 2nd wave of mandatory e-invoicing
1 Jan 2026 EU DAC8 harmonised crypto asset reporting
1 Jan 2026 France Small businesses join e-invoicing mandate
15 Jan 2026 Dominican Republic 3rd wave of mandatory e-invoicing
1 Jan 2028 EU Digital Reporting Requirements including e-invoicing harmonisation
1 Jan 2028 EU Structured e-invoices supersede paper invoices
1 Jan 2028 EU EC Sales lists replaced by Digital Reporting Requirements
2028 EU EU Customs reforms
1 Mar 2028 EU €150 import consignment threshold removed


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