Malaysia's High-Value Goods Tax (HVGT) implementation delayed after MoF fails to table bill at Parliament

The introduction of Malaysia's High-Value Goods Tax (HVGT), initially scheduled to be implemented on 1-May 2024 has been postponed.

Quoting sources familiar with the matter, The Edge Malaysia reports that the tax previously known as the Luxury Goods Tax will be postponed due to the Finance Ministry's delay in tabling the bill. The next opportunity for its presentation will not arise until the Dewan Rakyat reconvenes from 24-June 2024 to 18-July 2024.

Originally announced in the revised 2023 Budget last February, the HVGT aims to impose a tax ranging from 5 to 10 percent on certain high-value goods.  

The initial proposal by the Ministry of Finance also suggested for cars to be included in HVGT, and that luxury cars should have a threshold price of above RM 200,000 to be taxed.

However, WapCar’s checks with local offices of car companies dealing with high-end products at the time indicated that they had no knowledge of the matter. 

Also read: Not Luxury Goods Tax, but High-Value Goods Tax - Will cars priced above RM 200k be included?

Citing its sources The Edge reported that the delay stems from unresolved disagreements regarding the definition of "high-value goods" and the price range of items that will be subject to the tax.

This is despite ongoing dialogues and consultations with retail industry stakeholders and tax professionals. "There were some consultations and discussions, but there has been no progress following that," the source noted.

In separate reporting, the Finance Ministry previously revealed in March 2024 that it was in the final stages of crafting policies related to the HVGT, applying careful consideration that the policies don’t adversely impact low-income groups.

Also read: Higher tax on cars above RM 200k, MAA to submit proposal by end-Feb, gov to make decision by end-May 2024