By Selangor Journal Team
KUALA LUMPUR, October 18 – The federal government will not impose taxes on essential goods as it looks to streamline the Sales and Services Tax (SST) next year.
Prime Minister Datuk Seri Anwar Ibrahim, in his Budget 2025 speech, explained that while the SST will not affect basic items, it will be expanded to cover premium non-essential goods such as avocado and salmon.
He assured the SST would be applied progressively and in a way that does not burden the public.
In addition, the SST will include commercial financial services that charge fees on business-to-business transactions.
Anwar confirmed that industry engagement will be conducted to ensure the smooth and fair implementation of this tax expansion.
The government is also introducing a progressive dividend tax of 2 per cent on dividend payouts exceeding RM100,000, starting from the financial year 2025.
Anwar said this is aimed at broadening the tax base, ensuring tax revenue is collected not only from individuals and corporations but also from those who hold significant stock investments.
However, exemptions will be provided for dividends by statutory bodies and investment entities, such as the Employees Provident Fund and Permodalan Nasional Bhd.
He said the federal government will also introduce a carbon tax on the energy and iron and steel sectors by 2026.
Anwar said this will ensure players in these sectors employ low-carbon technology, while proceeds from the duties will be used to fund research into green technology.
