KUALA LUMPUR, June 28 – The Ministry of Finance (MoF) announced Friday that, after carefully considering public sentiment, it has decided not to proceed with the proposed expansion of the Service Tax to beauty services such as manicures and pedicures, facial services, and barbers and hairdressers.
The MoF said all revisions to the expanded Sales Tax and Service Tax were made after taking into account feedback from the public and industry.
“Since the announcement on June 9, 2025 regarding the revision of the Sales Tax and Service Tax (SST), the MADANI Government has closely followed feedback received from the rakyat and engaged with industry on the proposed expansion of the SST.”
In addition, the Ministry also engaged a number of backbenchers yesterday as part of its efforts to understand feedback from the grassroots, it said in a statement here today.
Select imported fruits to be exempt from Sales Tax
To recap, after due consideration of feedback received regarding the Sales Tax on imported fruits, Prime Minister and Minister of Finance, Datuk Seri Anwar Ibrahim, has agreed to exempt imported apples, oranges, mandarin oranges and dates from the Sales Tax.
The MoF reiterated that the MADANI Government has not imposed Sales Tax on daily essential goods in order to mitigate pressure on the cost of living for the majority of Malaysians.
These tax-exempted essential goods, whether locally produced or imported, include rice, chicken, beef, vegetables and eggs. Local fish varieties, including selar, tongkol, cencaru, and sardines, whether frozen, chilled or fresh, will also continue to be exempt from Sales Tax.
Higher annual sales threshold for Service Tax to ease burden on businesses
To reduce the number of small businesses affected by the revision of the Service Tax, the Prime Minister has also decided to increase the registration threshold for the Service Tax from RM500,000 to RM1 million for leasing or rental and financial services.
Additionally, the threshold for businesses to be subject to the Service Tax on rental services has been increased, from RM500,000 to RM1 million in total annual sales.
This means that only businesses with sales exceeding RM1 million will be required to pay the Service Tax on rental services, providing relief to more Micro, Small and Medium Enterprises (MSMEs), it said.
The MoF calls on all parties to make responsible and informed statements on the SST.
Please refer to the public announcements, infographics, subsidiary legislation, general rulings, guidelines and frequently asked questions (FAQs) issued via the official communication channels of the MoF and the Royal Malaysian Customs Department.
Members of the public and businesses may also call the SST Call Centre at the Royal Malaysian Customs Department.
