Starting next year, the country’s service tax will be increased by two percentage points to 8 percent, Prime Minister Datuk Seri Anwar Ibrahim told the Dewan Rakyat today.
To ensure the move does not burden the public, Anwar said the new rate will not apply to services related to food and beverages, and telecommunications.
“The government will also expand the scope of taxable services to include logistics, brokerage, sponsorship and karaoke,” he said when tabling Budget 2024 today.
He said this is among several tax reforms that will be implemented by the government to increase its revenue base to ensure better services and aid for the rakyat.
Anwar said Putrajaya has also agreed to enforce the implementation of Capital Gains Tax for the disposal of unlisted shares by local companies based on net profit at a rate of 10 percent, starting March 1, 2024.
The decision was made after taking into consideration the views of various stakeholders.
“The government is also considering the exemption of Capital Gains Tax for the disposal of shares related to certain activities, such as approved Initial Public Offerings (IPO), internal restructuring and venture capital companies, subject to certain conditions.”
Finally, Anwar said the government will enact a new law to introduce a High-Value Goods Tax at a rate of between five and 10 percent.
The tax will be implemented on various goods such as jewelry and luxury watches, based on the items’ threshold value.
