GST: Types of GST

Basically there are 3 categories of goods & services under the GST scheme in Malaysia:

1) Standard-rated GST
Goods & services in this category will be charged a tax rate of 6% at every stage of the supply chain. The tax is billed and collected by businesses and paid to the government. Each party, except the final consumer, can claim back credits on the GST they already paid (know as input tax). E.g. car, fruits & cloth.

2) Zero-rated GST
Goods & services in this category will be charged 0% GST. This means that GST is not charged to the final consumer. However, businesses can claim back credits on their input tax. E.g. meat, fish & cooking oil.

3) Exempt-rated GST
Goods & services in this category will be non-taxable and are not subject to GST at the output stage. This means that GST is not charged to the final consumer. However, it also means that businesses, especially the final party in the supply chain (before the final consumer) cannot claim back credits on their input tax even if they might have incurred it earlier on. E.g. residential property and health care services.

Information courtesy of Loanstreet.

GST: Dates that You & I should know

6 months before GST implementation (October 2014) - it is the recommended period to register GST as it provides adequate time for businesses to make preparation.

3 months before GST implementation (January 2014) - GST system makes it compulsory for businesses that exceeded the prescribed threshold to register GST

Official date of GST implementation (1 April 2015) - GST registered businesses begin to impose 6% GST

GST: Can Malaysia Builders survive the next big wave?

It is reported that Malaysia's biggest developer by market value, UEM Sunrise Bhd (UEMS) faces lower profit margins from a new tax and may delay some projects amid Malaysia's steepest slump in property sales since the 1998 recession. The company's costs will rise as a 6% GST which is starting in April 2015 boosts prices of building materials that can't be passed on for certain projects. The government introduced the GST to broaden its revenue base after running a fiscal deficit since 1998. Property demand has dropped 11% in 2013, the most since the 1998 recession. Fitch Ratings cut its Malaysia outlook to negative in July 2013, citing concern over deteriorating public finances. Whether Malaysia Builders can survive the GST wave next year is yet to be seen, although Malaysians are already feeling the pinch now. To read more: Bloomberg news