The Difference between GST and SST

Update Date:2018-10-31 15:54:06 Source:Tannet (Malaysia) Sdn Bhd Views:679

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After the government introduced the sales tax in 1972, the service tax was introduced in 1975 to form a Sales and Service Tax (SST), which was replaced by the Consumption Tax (GST) on April 1, 2015. After the change of the government, the new government will adjust the GST tax rate to 0% from June 1, 2018, and officially introduced SST on September 1.

The Difference between GST and SST




Single Tax System.

For manufacturers only, manufacturers only need to pay the relative tax rate to the government.

Tax System

Multi-Stage Tax System.

Involving manufacturers, distributors, retailers and final consumers.

The output tax reported by the dealer can be absorbed from the input tax, pay only the tax difference between the two.

Different from others fields, and whether the company’s total sales in the fiscal year are eligible for submission

For example, the annual turnover of the restaurant industry exceeds RM500, 000, and the service tax registration is required.

Involved Range

Merchants in any field must register and report GST as long as the total sales in the fiscal year are close to RM500, 000.

Manufacturers only need to add taxes to the summary of Invoice.


The company must calculate the output tax and the absorption from the input tax (Input Tax), pay only the tax difference between the two

Mainly absorbed by the party (manufacturer) who paid, but most manufacturers will calculate this expense in the price of the item. So in the end, consumers are not easily aware of the increase in spending, which we call ‘hidden tax’.


Since the tax system is paid by multiple levels of payers, the summary paid by each party includes GST, so the final expenditure is borne by the final consumer.

In 2014, this single tax system brought RM20 billion in revenue to the government.

Government Revenue

Since its launch, GST has generated about RM40 billion in annual revenue for the government.

SST Listings

Here's a simple list for everyone:

1. 10% SST

a) Beverages: bottled mineral water and boxed soda, boxed drinks and wine;

b) Electronics: digital cameras, mobile phones and projectors

2. 6% SST

a) Advanced services: hotels, nightclubs, private clubs, golf clubs with a turnover of more than RM500,000;

b) Catering industry: restaurants and hawkers centres with internal and external sales of more than RM1 million;

c) Services: communications, accountants, professional engineers, attorneys' fees, parking services, courier services, car services, professional agencies, insurance companies or Islamic insurers, etc.;

d) Gaming industry.

3. 5% SST

a) Processed foods: dried mangoes, dried pears, processed nut products and frozen durians;

b) Electronic products: laptops, small notebooks, mice, keyboards, printers and photocopiers;

c) Wine.

4. 0% SST

a) Daily necessities;

b) Medical drugs;

c) Wards and food in private hospitals;

d) Canteens in schools and places of worship.

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