Malaysia VAT Rate 2026: 10% Standard Rate

How Much Is SST in Malaysia?

The standard SST (the local equivalent of VAT) rate in Malaysia is 10% in 2026, with no reduced rates. It applies to most goods and services sold in Malaysia. Standard VAT/GST rates worldwide range from around 5% to 27%.

How to calculate Malaysia SST

To add 10% SST to a net (tax-exclusive) price, multiply it by 1.1. To remove SST from a gross (tax-inclusive) price, divide it by 1.1.

• Add SST: MYR 100 net × 1.1 = MYR 110 gross (that is MYR 10 of SST)
• Remove SST: MYR 110 gross ÷ 1.1 = MYR 100 net (that is MYR 10 of SST)

Use the Malaysia SST calculator above for any amount, or compare Malaysia with every other country in our SST rates by country table.

Current VAT Rates

Historical VAT Rate Changes

• 2026: Current standard rate in force
• 2018: Sales & Service Tax (SST) reintroduced, replacing GST
• 2015: GST introduced at 6%

Economic Impact

VAT contributes approximately 20-30% to Malaysia's total tax revenue. The current rate structure balances revenue generation with economic competitiveness within the Asia-Pacific region.

Zero-Rated Items

The following items are zero-rated for VAT in Malaysia:

• Exports of goods and services
• International transportation
• Some basic food items
• Children's clothing
• Books and newspapers
• Prescription medications

VAT Exempt Items

The following are exempt from VAT in Malaysia (no VAT charged, no input VAT recovery):

• Financial services
• Insurance services
• Healthcare and medical services
• Education and training
• Postal services
• Charitable activities

Reduced Rate Applications

Items subject to reduced VAT rates in Malaysia:

• No reduced rates apply in this country

Malaysia requires Sales & Service Tax registration once taxable turnover exceeds MYR 500,000 over 12 months. Always confirm current thresholds and deadlines with the Royal Malaysian Customs Department, as they are reviewed periodically.

VAT Registration

• Registration Threshold: MYR 500,000
• Voluntary Registration: Available below threshold
• Registration Process: Online via tax authority website
• Processing Time: Typically 2-4 weeks

VAT Returns and Payment

• Filing Frequency: Bi-monthly
• Filing Deadline: End of month following period
• Payment Methods: Bank transfer, online payment
• Late Filing Penalties: Varies by amount and delay

Cross-Border Trade

Special considerations for international transactions:

• Intra-EU Trade: Not applicable (non-EU country)
• Imports: VAT payable at point of entry
• Exports: Generally zero-rated
• Digital Services: Special rules may apply

For background on how the buyer accounts for VAT on intra-EU and cross-border B2B supplies, see the reverse charge mechanism. For B2C digital sales and low-value imports, see VAT on digital services and cross-border e-commerce.

Nearby Countries

What is the current VAT rate in Malaysia?

The standard VAT rate in Malaysia is 10% as of 2026. This applies to most goods and services unless they qualify for reduced rates or exemptions.

How do I calculate VAT in Malaysia?

To add VAT: multiply the net amount by 10%. To remove VAT from a gross amount: divide by 1.10. Use our calculator above for instant results.

Who needs to register for VAT in Malaysia?

Malaysia requires Sales & Service Tax registration once taxable turnover exceeds MYR 500,000 over 12 months.

Can I reclaim VAT in Malaysia?

VAT-registered businesses can generally reclaim input VAT on business purchases. Non-EU tourists may claim VAT refunds on qualifying purchases when leaving the country — see our guide to VAT refunds for tourists and non-resident businesses.