Refined sugar to stay tax-exempt, says Finance Ministry

PETALING JAYA: Refined sugar, commonly known as white sugar, will remain untaxed under the revised sales and service tax (SST) framework set to take effect from July 1, says the Finance Ministry.

Addressing concerns raised by manufacturer MSM Malaysia Holdings Berhad, the ministry said the government’s targeted taxation approach would ensure that essential goods including sugar, salt, chicken, eggs, meat, fish, vegetables, cooking oil, and rice remain unaffected by the SST adjustments.

Raw sugar, a key ingredient in the production of refined sugar, will be subject to a 5% sales tax, but manufacturers such as MSM are eligible to apply for tax exemption, it added in a statement on Friday (June 20).

“This is facilitated under the provisions of Item 1, Column (2), Schedule B of the Sales Tax (Persons exempted from payment of tax) order via the Royal Malaysian Customs Department,” the statement read.

The ministry also pointed out that sugar refining companies have been receiving monthly incentives from the government to ensure stable supply and pricing.

“As such… there should be no increase in the retail price of refined sugar.

“The exemption mechanism and continued government support are in place to prevent cost burdens from being passed on to consumers,” it added.