Here are Malaysia’s statutory updates for 2025.
Effective 1 May 2025
Malaysia Expands Sales and Services Tax Framework
Malaysia’s 2025 Budget introduces significant changes to the Sales and Services Tax (SST), broadening its scope to cover a wider range of goods and services:
- Sales Tax: Premium and non-essential goods, such as luxury items like imported salmon and avocados, will now be subject to sales tax.
- Service Tax: Business-to-business (B2B) services, including fee-based financial services, will be taxed for the first time, aligning with international practices.
These measures aim to enhance revenue collection and reflect Malaysia’s shift toward modernising its tax system.
Source: VAT Calc
Effective February 2025 and August 2025
Malaysia’s Minimum Wage Increase
The Malaysian government has announced a minimum wage increase to RM1,700 per month under the Minimum Wage Order 2024. The implementation will be rolled out in phases:
- From 1 February 2025:
Applicable to employers with five or more employees, or those engaged in professional activities as classified under MASCO 2020. - From 1 August 2025:
Applicable to employers with fewer than five employees who are not engaged in professional activities. The minimum wage for these employers remains at RM1,500 per month until 31 July 2025.
Non-compliance may result in legal penalties under the National Wages Consultative Council Act 2011 (Act 732).
Source: NST Malaysia
