The Royal Malaysian Customs Department (RMCD) had on 3 November 2023 issued the guidelines on Sales Tax on Low Value Goods (LVG). The imposition of sales tax at the rate of 10% on LVG will start on 1 January 2024 and covers goods brought into Malaysia (by land, air and sea) and sold at a price not exceeding RM500.
The sales tax is charged on the sale value of LVG not including any tax, duty, fee or other charges such as transportation, insurance or other costs
What is defined as LVG?
LVG refers to all goods sold at a price not exceeding RM500 and brought into Malaysia via air, land or sea, excluding:
a) cigarettes;
b) tobacco products;
c) intoxicating liquors;
d) smoking pipes;
e) electronic cigarettes and similar personal electric vaporizing devices; and
f) preparation of a kind used for smoking through electronic cigarette and electric vaporizing device, in forms of liquid of gel, whether or not containing nicotine.
Who should register?
A seller (person whether in or outside Malaysia) who sells LVG on an online platform or operates an online marketplace with sales value in 12 months exceeding RM500,000 is liable to be registered with RMCD.
Taxable period
The taxable period shall be on a period of three (3) months ending on the last day of any month of any calendar year. The following table demonstrates the taxable period in the event a Company is registered starting April in a year.
| Filing frequency | Taxable period |
| First taxable period | April to June |
| Subsequent taxable period | July to Sept, Oct to Dec etc. |
The seller is required to pay the amount of sales tax not later than the last day of the month following the end of the taxable period. In the example above, the Company would be required to pay sales tax not later than end of July for the first taxable period.
Penalty
The Penalty imposed is as below:
| Period of late payment | Penalty rate |
| 1 to 30 days from the first day after the payment deadline | 10% |
| 31 to 60 days from the first day after the payment deadline | Additional 15% (10% + 15% = 25%) |
| 61 to 90 days from the first day after the payment deadline | Additional 15% (10% + 15% +15% = 40%) |
