Transitional rules for changes in service tax rate

Transitional rules for changes in service tax rate

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Effective from 1 March 2024, the service tax rate is increased from 6% to 8% on all prescribed taxable services excluding food and beverage, telecommunications services, provision of parking space services and logistics services.
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Credit card and charge card services will remain at a specific rate of RM25 per year.

The draft guideline on the transitional rules of the rate changes dated 7 February 2024 has been released by the Royal Malaysian Customs Department (“RMCD”) in Malay language. Generally, the guideline states that the determination of service tax rate shall be based on the date of service is provided or date of imported taxable service is acquired.