What you should know about SST

A sign displaying the zero-rated GST change is seen at a food outlet at Avenue K in Kuala Lumpur July 18, 2018. — Picture by Hari Anggara
A sign displaying the zero-rated GST change is seen at a food outlet at Avenue K in Kuala Lumpur July 18, 2018. — Picture by Hari Anggara

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KUALA LUMPUR, Aug 22 ― The Sales and Services Tax (SST) can be implemented as scheduled on September 1, 2018, as the conversion  from the Goods and Services Tax (GST) regime will not be time consuming.

Head, Sage Asia Startups and Small Businesses, Kamlesh Mahtani, said although it's only nine days to the deadline, businesses do not need to implement a new custom system for the conversion to SST.

“The system is already in place and the tax percentage imposed is clear. Although the SST takes force on Sept 1, companies still have until the end of September to register with the Customs Department,” he told Bernama.

When asked if the GST was a more comprehensive tax and more effective in curbing tax leakages,, Mahtani agreed that it was more structured, but heavier penalties await those who attempt to evade the SST.

“There are higher penalties for tax evasion by way of filing false claims and the government will not hesitate to act against companies which attempt to do so,” he said.

According to the Sales Tax Bill 2018, any person who evaded the tax or assisted  in fraudulent tax evasion can be fined between 10 times and 20 times the amount of sales tax avoided or imprisoned for up to five years, or both.

Repeat offenders would be fined no less than 20 times and not more than 40 times the amount of sales tax, or up to seven years imprisonment, or both.

Mahtani said the SST was much more accommodative for businesses, especially for small and medium enterprises while the GST had too much rules and cause disruptions in cash flows.

He said under the new tax to be imposed, the 10 per cent sales tax would only be implemented at a single level, especially at the import phase while the GST was applied at every level, adding that businesses would only be taxed after receiving the goods.

“During the GST era, companies had to pay the input tax even before the purchase took place and the claiming process and refund took a long time, taking a heavy toll on businesses,” he said.

Yesterday, the Dewan Negara passed the Sales Tax Bill 2018, Service Tax Bill 2018, Goods and Services Tax (Repeal) Bill 2018, Customs (Amendment) Bill 2018 and Free Zones (Amendment) Bill 2018. ― Bernama

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