MSME Rental Service Tax Reduced to 6% with Exemption Threshold Raised to RM1.5million and Deferment for New Businesses

Prime Minister Datuk Seri Anwar Ibrahim has announced a reduction in the service tax on rentals for micro, small, and medium enterprises (MSMEs) from 8% to 6%. Additionally, the government has raised the tax exemption threshold to include businesses with an annual turnover of up to RM1.5 million. To further support growth, newly established MSMEs will be granted a one-year deferment on rental service tax. These measures are expected to reduce government revenue by nearly half a billion ringgit annually but are aimed at easing business burdens.

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