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Daily Express
31-07-2025
- Business
- Daily Express
Government cancels tax on luxury goods
Published on: Thursday, July 31, 2025 Published on: Thu, Jul 31, 2025 By: Bernama Text Size: Kuala Lumpur: The government has decided not to proceed with the implementation of the high-value goods tax (HVGT), according to the Finance Ministry (MOF). In a written reply on the Parliament website, the MOF stated, however, that the principles of the HVGT have been incorporated into the revised sales tax structure, with luxury and discretionary items taxed at five or 10 per cent. The ministry said this in response to a question from Datuk Shamshulkahar Mohd Deli (BN-Jempol), who asked about the projected rise in national revenue resulting from fiscal reform measures, including the introduction of HVGT, the digital goods tax, capital gains tax (CGT), low-value goods tax, and the expansion of the SST tax and subsidy rationalisation that are being or will be implemented. The proposal to introduce HVGT was first announced at the revised presentation of Budget 2023 in February 2023. Initially planned to be implemented by May 2024, the government had expected to generate an additional RM700 million annually from it. However, the government at that time indicated that more time was needed to engage with relevant stakeholders to ensure its effective implementation without negatively impacting the economy. Meanwhile, the MOF said the government has taken several steps under direct and indirect taxation to strengthen national revenue collection. Among them is the implementation of the CGT, effective March 1, 2024. 'Based on the current transaction volume and value involving unlisted shares, the government estimates revenue collection of about RM800 million a year,' it said. The sales tax rate revision and the expanded scope of the service tax, effective July 1 2025, are also expected to contribute an additional RM5 billion revenue in 2025, doubling to RM10 billion in 2026. As for diesel subsidy targeting, it has so far generated RM600 million in monthly government savings. Additionally, the low-value goods tax, effective Jan 1, 2024, recorded a collection of about RM500 million for the year 2024. The government's decision to halt the proposed high-value goods tax (HVGT), formerly known as the luxury goods tax, will not affect the RM700 million tax revenue expected from its implementation, said an economist. Sunway University economics professor Dr Yeah Kim Leng said the move will instead ease concerns over the potential impact of the tax on consumer and tourist spending, as its incorporation into the existing expanded Sales and Service Tax (SST) has removed uncertainty over which items are subject to tax. He explained that since the principles of the HVGT have been integrated into the expanded SST structure, where luxury and discretionary items are now taxed at five or 10 per cent, the rates are effectively the same as those proposed for the HVGT in Budget 2023. 'The revenue target will not be affected as the same SST rate will be applied without the need to define which goods are considered high value,' Yeah told Bernama. * Follow us on our official WhatsApp channel and Telegram for breaking news alerts and key updates! * Do you have access to the Daily Express e-paper and online exclusive news? Check out subscription plans available. Stay up-to-date by following Daily Express's Telegram channel. Daily Express Malaysia
Sinar Daily
30-07-2025
- Business
- Sinar Daily
Government cancels high-value goods tax implementation
The proposal to introduce HVGT was first announced at the revised presentation of Budget 2023 in February 2023. 30 Jul 2025 10:08am In a written reply on the Parliament website yesterday, the MOF stated, however, that the principles of the HVGT have been incorporated into the revised sales tax structure, with luxury and discretionary items taxed at five or 10 per cent. KUALA LUMPUR - The government has decided not to proceed with the implementation of the high-value goods tax (HVGT), according to the Finance Ministry (MOF). In a written reply on the Parliament website yesterday, the MOF stated, however, that the principles of the HVGT have been incorporated into the revised sales tax structure, with luxury and discretionary items taxed at five or 10 per cent. The ministry said this in response to a question from Datuk Shamshulkahar Mohd Deli (BN-Jempol), who asked about the projected rise in national revenue resulting from fiscal reform measures, including the introduction of HVGT, the digital goods tax, capital gains tax (CGT), low-value goods tax, and the expansion of the SST tax and subsidy rationalisation that are being or will be implemented. The proposal to introduce HVGT was first announced at the revised presentation of Budget 2023 in February 2023. Initially planned to be implemented by May 2024, the government had expected to generate an additional RM700 million annually from it. However, the government at that time indicated that more time was needed to engage with relevant stakeholders to ensure its effective implementation without negatively impacting the economy. Meanwhile, the MOF said the government has taken several steps under direct and indirect taxation to strengthen national revenue collection. Among them is the implementation of the CGT, effective March 1, 2024. "Based on the current transaction volume and value involving unlisted shares, the government estimates revenue collection of about RM800 million a year,' it said. The sales tax rate revision and the expanded scope of the service tax, effective July 1 2025, are also expected to contribute an additional RM5 billion revenue in 2025, doubling to RM10 billion in 2026. As for diesel subsidy targeting, it has so far generated RM600 million in monthly government savings. Additionally, the low-value goods tax, effective Jan 1, 2024, recorded a collection of about RM500 million for the year 2024. - BERNAMA More Like This
The Sun
30-07-2025
- Business
- The Sun
Govt scraps high-value goods tax, adjusts sales tax rates
KUALA LUMPUR: The government has decided not to proceed with the implementation of the high-value goods tax (HVGT), according to the Finance Ministry (MOF). In a written reply on the Parliament website yesterday, the MOF stated, however, that the principles of the HVGT have been incorporated into the revised sales tax structure, with luxury and discretionary items taxed at five or 10 per cent. The ministry said this in response to a question from Datuk Shamshulkahar Mohd Deli (BN-Jempol), who asked about the projected rise in national revenue resulting from fiscal reform measures, including the introduction of HVGT, the digital goods tax, capital gains tax (CGT), low-value goods tax, and the expansion of the SST tax and subsidy rationalisation that are being or will be implemented. The proposal to introduce HVGT was first announced at the revised presentation of Budget 2023 in February 2023. Initially planned to be implemented by May 2024, the government had expected to generate an additional RM700 million annually from it. However, the government at that time indicated that more time was needed to engage with relevant stakeholders to ensure its effective implementation without negatively impacting the economy. Meanwhile, the MOF said the government has taken several steps under direct and indirect taxation to strengthen national revenue collection. Among them is the implementation of the CGT, effective March 1, 2024. 'Based on the current transaction volume and value involving unlisted shares, the government estimates revenue collection of about RM800 million a year,' it said. The sales tax rate revision and the expanded scope of the service tax, effective July 1 2025, are also expected to contribute an additional RM5 billion revenue in 2025, doubling to RM10 billion in 2026. As for diesel subsidy targeting, it has so far generated RM600 million in monthly government savings. Additionally, the low-value goods tax, effective Jan 1, 2024, recorded a collection of about RM500 million for the year 2024. - Bernama
New Straits Times
30-07-2025
- Business
- New Straits Times
Finance Ministry discontinues High Value Goods Tax
KUALA LUMPUR: The government will no longer proceed with the implementation of the High Value Goods Tax (HVGT), the Finance Ministry said in a written parliamentary reply last night. The ministry was responding to Datuk Shamshulkahar Mohd Deli (BN-Jempol) who sought the Finance Minister to clarify the projected increase in national income resulting from the implementation of fiscal reforms. These include the introduction of high value goods tax (HVG), digital goods tax (DGT), capital gains tax (CGT) and low value goods tax (LVG), as well as the expansion of Sales and Services Tax (SST) and the rationalisation of existing and upcoming subsidies.
