Prime Minister Dato’ Seri Najib Razak tabled Malaysia’s Budget 2017 in Parliament on 21 October 2016, themed “Ensuring Unity and Economic Growth, Inclusive Prudent Spending, Wellbeing of the Rakyat”. The GST-related measures announced in his speech are as follows:

Widening of GST relief for disabled persons

It is proposed that the GST relief for disabled persons be given to all OKU card holders on the purchase of approved equipment from the suppliers designated by the Social Welfare Department, with effect from YA 2017.

Streamlining the GST treatment in Free Industrial Zones (FIZ) and Free Commercial Zones (FCZ)

It is proposed that the GST treatment be determined as follows:

• GST is not chargeable on the supply and removal of goods made:

– within and between FCZ – within and between FIZ, and

– between FCZ and FIZ. • GST shall not be due and payable on the goods imported into FIZ.

• GST is suspended on the removal of goods from free zone to Designated Areas, ie Langkawi, Labuan and Tioman, vice versa.

• GST is suspended on the removal of goods from free zone to an approved warehouse under the Warehousing Scheme, vice versa.

The above treatment shall not be applicable on the following supplies:

• Goods as prescribed under the Free Zones (Exemption of Goods and Services) Order 1998

• Goods and services as prescribed under Goods and Services Tax (Imposition of Tax for Supplies in Respect of Designated Areas) Order 2014, and

• Any other goods prescribed by the Minister of Finance. The proposals are effective from 1 January 2017.

Streamlining the GST treatment between imported and local goods under the Warehousing Scheme

It is proposed that no GST shall be charged on goods from Licensed Manufacturing Warehouse, Excise Warehouse and FIZ that are deposited into and supplied within or between above warehouses under the Warehousing Scheme.

The proposal is effective from 1 January 2017.

Source: Ministry of Finance website, 21 October 2016