In Malaysia’s Budget 2014 speech, the implementation of Goods and Service Tax (GST) was perhaps the hottest topic. To be introduced in April 2015, it will replace Malaysia’s Sales tax (10%) and Service tax (6%). Under GST, most of the goods and services (except basic necessities) will be charged a tax rate of 6% at every stage of the supply chain. The question now on everyone’s mind – How will life be after GST?
To identify the most likely effects, we must first understand the different implementations of GST and their mechanisms.
Types of GST
There will be three different categories of goods & services under the GST scheme in Malaysia. They are:
I. Standard-Rated GST
Goods and services in this category will be charged a tax rate of 6% at every stage of the supply chain. The tax is billed and collected by businesses and paid to the government. Every party except the final consumer can claim back credits on the GST they already paid (known as input tax). Examples of the goods in this category are cloth, car and fruits. The following diagram shows how Standard-Rated GST works:
For more details GST Software, please contact Bifrost Tech Sdn Bhd at 04-6459769 / 04-6384789 or email to our support team at support@bifrostech.com or visit our website at http://www.bifrostech.com
To identify the most likely effects, we must first understand the different implementations of GST and their mechanisms.
Types of GST
There will be three different categories of goods & services under the GST scheme in Malaysia. They are:
I. Standard-Rated GST
Goods and services in this category will be charged a tax rate of 6% at every stage of the supply chain. The tax is billed and collected by businesses and paid to the government. Every party except the final consumer can claim back credits on the GST they already paid (known as input tax). Examples of the goods in this category are cloth, car and fruits. The following diagram shows how Standard-Rated GST works:
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