No SST for construction services and building material costs

penang-development-no-sstFinance Minister Lim Guan Eng has announced that building materials and construction services will be exempt from the Sales and Services Tax (SST) which will come into force in September.

“With the proposed exemption of goods from SST and the difference in GST (Goods and Services Tax) implementation, I hope both the developers and the buyers can benefit from the reduction of this tax burden,” he said in a statement today.

He noted that during the GST regime, basic construction materials such as bricks, cement, sand as well as construction services were subjected to GST at 6%.

“This had led to increased construction costs under the GST era, including the increase in house prices.

“The pressure on house prices, industrial and commercial buildings is expected to be eased by the abolition of GST and the exemption of SST. The Federal Government hopes that the construction costs can be reduced with the exemption of SST.

“Some of the building materials that will not be subjected to SST are cement, sand and iron,” he said.

The SST will impose a 6% services tax on any taxable services provided in Malaysia by a registered person while they are carrying out a business as well as a 10% sales tax on any taxable goods made in Malaysia and sold, used or disposed of by a registered manufacturer.

The 10% tax will also be imposed on taxable goods imported into the country by any person.

In early August, Parliament had passed the Sales Tax Bill 2018 and Services Tax Bill 2018.

Source: EdgeProp.my


  1. xulih
    August 20th, 2018 at 09:02 | #1

    Please don’t be over excited by the exemption of the SST on building materials yet as the details on goods taxable have not been finalised. Many contractors are in limbo and the sooner the government comes up with the exemption list the sooner the better.

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