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Taxand Malaysia wins at ITR Asia awards and announces introduction of Goods & Services Tax
We are pleased to announce that Taxand Malaysia has won the International Tax Review (ITR) Asia 2009 Transfer Pricing Firm of the year award for Malaysia. Taxand Malaysia, within three short years since its establishment has been recognised by both our clients and our peers in winning this award, for which we are both proud and grateful.
The Government has announced that the Bill to introduce GST will be tabled for the first reading in Parliament before the close of this year. On the basis that the Bill is passed, the key concern will be the effective date of introduction of this new tax, which will replace the current service tax and sales tax. It is expected that GST will be imposed at the rate of 4% and will take effect within an 18 month period. The Prime Minister is quoted as saying that the introduction of GST will be 'gentle' to ensurethat the rakyat are not adversely affected. The question as to whether this will be a prelude to a reduction in income tax rates is still open at present. Nonetheless, businesses will need to take steps to ensure that they are 'GST ready'.
The GST Bill will have provisions governing the time of supply, the value of the supply, the requirements for registration, etc. Supplementary Regulations will undoubtedly be issued governing the types of taxable supplies, etc. As mentioned above, GST is likely to be implemented within an 18 month period after the second reading of the GST Bill, which would be towards the end of 2011. It would be sensible to implement this with effect from 1 January 2012, rather than to follow the 18 month period strictly. Businesses will certainly require this time to prepare themselves to transition towards a GST compliant system to ensure that they are able to self assess and pay GST in a timely manner. Clearly, the Customs Department will Raw Materials Processing Sale of product Consumer GST RM8.00 also need to ensure that it is prepared to deal with the voluminous requirements to ensure that the GST system is properly implemented. There will be numerous questions and issues surrounding the initial implementation of GST, but in the midst of these uncertainties, one thing is certain, all businesses must be GST ready.
Your Taxand contact for further queries is:
T. +603 2032 2799
Read the full tax alert from Taxand Malaysia here.