5 Financial Expenses Or Rates That Go Up In 2024

Every year, the government reviews the implementation of taxes and duties and makes adjustments to these rates. If you have not caught up with the news, here’s a summary of the latest changes to the rates or financial expenses that are slated to go up in 2024. 

Read Also: 5 Things Malaysians Can Get For Free (And How Much Do They Actually Cost)? 

#1 Sales Tax On Low Value Goods (LVG) Starting January 2024 

If you shop online, you’ve probably noticed the implementation of a 10% sales tax when you purchase any items under RM500 in Malaysia. 

The Low Value Goods (LVG) tax was charged starting from 1 January 2024 to address the discrepancy in tax payments between physical and online retailers. 

Previously, there was no sales tax or import duty on LVGs, which are items priced below RM500. 

However, this The LVG tax does not apply to cigarettes, tobacco products, intoxicating liquors, or smoking pipes. These are already subject to import duty, excise duty and sales tax. 

Read Also: Sales Tax On Low-Value Goods In 2024: How It Will Impact Consumers In Malaysia? 

#2 Excise Duty Rate For Sugary Drinks To Raise 10 Sen Per Litre From January 2024 

The government initially implemented an excise duty on sugary drinks at the rate of RM0.40 per litre from 1 July 2019. As announced during the tabling of Budget 2024 last October, from 1 January 2024, the excise duty was raised again from RM0.40 to RM0.50 per litre. 

Revenue from excise duty collection is used on initiatives to address and treat diabetes including support for kidney dialysis centres. 

An excise duty will be charged for the following sweetened drinks that cross the sugar content threshold: 

  Source: Ministry of Finance 

#3 Water Tariff Rates To Increase By 22 Sen Per Cubic Metre From February 2024 

In January 2024, the National Water Services Commission (SPAN) announced an average increase of 22 sen per cubic metre for water tariff rates across households in Peninsular Malaysia and the Federal Territory of Labuan. 

The price increase took effect from 1 February 2024, with SPAN reviewing the water tariff rates every 3 years.  

In Malaysia, state governments are tasked with developing, operating and maintaining water supplies. You can check the local water operator’s website in your state such as Air Selangor to find out the specific changes in fees. 

The tariff adjustment will enable water operators to upgrade infrastructures, water treatment plants and organise periodic maintenance for smooth water suppliance. 

#4 Service Tax To Increase By 2% From March 2024 

From 1 March 2024, the service tax rate for most taxable services under the Service Tax Act (STA) 2018, including digital services provided by foreign registered individuals will increase from 6% to 8% . 

This tax hike does not apply to services such as food and beverages and telecommunications. The proposal for the service tax hike was mentioned during the tabling of the Budget 2024.        

It has been reported that Google has informed Workspace users that a service tax of 8% will be charged from 1 March 2024. 

The Immigration Department of Malaysia has also put out an announcement that a service tax of 8% will apply to fees for the application of employment passes. 

#5 Sales Tax On High Value Goods Imposed From May 2024   

Another new sales tax on high value goods is expected to commence from 1 May 2024, announced during the National Budget 2024 presentation. 

When Malaysians purchase certain high value goods, they will have to pay a High Value Goods (HVG) Tax of 5% to 10%. The collection of the HVG tax is to increase the government’s revenue and will affect only those with a higher income who can afford such high value items.   

To promote tourism, tourists are exempt from the HVG tax. 

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