Sales Tax on Low Value Goods (“LVG”) Legislations

In line with the charging and levying of Sales Tax on LVG effective 1 April 2023, the Ministry of Finance (“MOF”) has issued the following Regulations and Orders, all with an effective date of 1 January 2023.

i.       Sales Tax (Low Value Goods) Regulations 2022, which covers amongst others, the following:

Regulation 5 – Every registered seller who sells LVG must clearly display the information of the consignment note (with the Sales Tax registration number) by patching or affixing the information on the package of LVG.

Regulation 6 – Prescribed particulars for invoice or document in relation to the sale of LVG.

ii.      Sales Tax (Determination of Low Value Goods) Order 2022, which states:

Sales Tax on LVG shall be charged on all goods which are sold at a price not exceeding RM500 and are brought into Malaysia by land, sea or air.

iii.     Sales Tax (Total Sale Value of Low Value Goods) Order 2022, which states:

The total sale value of LVG for registration purposes is RM500,000.

iv.     Sales Tax (Rate of Tax for Low Value Goods) Order 2022, which states:

The rate of Sales Tax for LVG is 10%.

v.      Sales Tax (Persons Exempted from Payment of Tax) (Amendment) (No. 2) Order 2022, where amendment has been made to item 24 Schedule A of the Sales Tax (Persons Exempted from Payment of Tax) Order 2018 to cover goods imported using air courier service including postal service and exclude additional goods (e.g. smoking pipes, electronic cigarettes, etc.), with a total CIF value not exceeding RM500 per consignment. 

Please click on the above header link for a copy of the Regulations and Orders at the official portal of the Federal Legislation.

MyLVG Portal

The Royal Malaysian Customs Department (“RMCD”) has launched the official portal for LVG, i.e. MyLVG.  At present, this portal allows online submission of the application for registration. Please click on the above header link to access the portal.

RMCD has also issued an announcement on 6 January 2023 with regards to the abovementioned updates (amongst others, it states that, applicants can start applying to be registered from 1 January 2023).  Please click on the above header link for a copy of the RMCD’s announcement at the MySST portal.

The above are largely in line with the draft Guide on Sales Tax on LVG recently issued by RMCD (Note: the latest updated Guide is as at 9 January 2023 and there are no major changes made to the earlier version dated 21 December 2022).  Please click on the above header link for a copy of our earlier Tax Whiz.

Our highlights are intended to provide a general overview of the key proposed tax changes and should not be used or relied upon as a substitute for detailed advice or as a basis for formulating business decisions.

For customized guidance, please do not hesitate to reach out to your trusted KPMG adviser(s),

Petaling Jaya Office

Soh Lian Seng
Executive Director -
Head of Tax and Head of Tax Dispute Resolution
+ 603 7721 7019

Bob Kee
Executive Director -
Head of Transfer Pricing
+ 603 7721 7029

Tai Lai Kok
Executive Director -
Head of Corporate Tax
+ 603 7721 7020

Long Yen Ping
Executive Director -
Head of Global Mobility Services
+ 603 7721 7018

Ng Sue Lynn
Executive Director -
Head of Indirect Tax
+ 603 7721 7271

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Penang Office

Evelyn Lee
Executive Director -
Penang Tax
+604 238 2288 (ext. 312)

Ipoh Office

Crystal Chuah Yoke Chin
Associate Director -
Ipoh Tax
+605 253 1188 (ext. 320)

Kuching & Miri Office

Regina Lau
Executive Director -
Kuching & Miri Tax
+6082 268 308 (ext. 2188)

Kota Kinabalu Office

Titus Tseu
Executive Director -
Kota Kinabalu Tax
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Johor Bahru Office

Ng Fie Lih
Executive Director -
Johor Bahru Tax
+607 266 2213 (ext. 2514)