After the 2018 election, while GST decreased to 0%, government have also announced Sales & Service Tax (SST) will be officially implemented in September this year. So, they are both taxes, what’s the most important differences between GST and SST for consumers? SST is said to be less burdensome, how is that not burdensome, and in what form is it collected in comparison with GST? Before you know the difference, look at the following chart to build a basic understanding of SST and GST.
GST is a multi-level tax system for most businesses and industries, including manufacturers, distributors, retailers and consumers. GST covers a wide range, from manufacturers selling products to dealers, reselling them to retailers, and then reselling them to consumers at every stage. ; While SST is a single tax system, only the service industry and manufacturers need to pay SST when selling products to dealers. SST has only one phase to pay taxes, compared with every phase of GST.Differences (2) threshold
While both GST and SST require registration for a turnover of more than 500,000, SST does not include any buying or selling of a home or property, and GST is included. For the average person, buying a house is hard enough, plus a 6% excise tax, to make it harder to buy a house. In addition, SST involves a narrow level, and most of the daily supplies do not involve SST. However, GST covers a wide range of aspects, and a lot of things will be levied on GST. According to official information, when SST comes into effect, all GST registered companies will automatically default to SST registered merchants and turn in every 2 months. So merchants do not need to adapt to the new system again, nor do they need to register again.
The above two differences are about the basic differences between GST and SST, which is also the fundamental reason why people of our country opposed the implementation of GST in the first place. Before the SST is officially implemented, take time to enjoy the ‘honeymoon period’ of spending money in Malaysia.