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In the 2020 Budget announced on 11 October 2019, the AMES was proposed to allow approved traders and manufacturers of exempted goods who export not less than 80% of their annual sales, to enjoy the following benefits:

  1. full sales tax exemption on the importation and purchase of goods or raw materials, components and packaging materials.
  2. not required to determine the quantity of goods to be exported at the time of importation or purchase of goods.
  3. pay Sales Tax only for the portion of trading goods or manufactured exempted goods that are not exported or sold in the local market, based on a prescribed formula.
  4. pay Sales Tax only for the waste or refuse of raw materials, components and packaging materials used for the manufacturing of exempted goods that are disposed or sold in the local market.

The relevant legislation was subsequently introduced as Part IXA of the Sales Tax Act 2018, which comes into operation on 1 July 2020.  On 30 June 2020, the Sales Tax Regulations 2018 was also amended to introduce Part IXA, and is effective 1 July 2020.

In conjunction with the above, the Royal Malaysian Customs Department (“RMCD”) has issued an announcement with regards to the conditions as well as application form for AMES on its official website for Sales Tax and Service Tax (“MySST”).  Please note that the conditions as well as application form are currently available in Bahasa Malaysia only.

For more details, please refer to our Tax Whiz which can be accessed via the above link.

The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

 Ng Sue Lynn 

 Executive Director
 Indirect Tax Practice

Dato’ Tan Sim Kiat 

 Advisor 
 Indirect Tax Practice

Yap Choon Ling 

 Director
 Indirect Tax Practice