THE list of goods and businesses subjected to the sales and services tax (SST) is not final and will be “dynamic” and “organic”, Finance Minister Lim Guan Eng said on the third day since the single-stage tax was re-implemented.

Further exemptions can be made, he said, as Putrajaya wants to take a “soft” approach towards implementing the SST which is 5% and 10% for sales tax and 6% for services.

Lim’s remarks at a press conference today come amid confusion over the list of taxable items after the government retracted a few items from the list, saying they were mistakenly added because of the way some items were “grouped”.

“It’s not a static list. It’s a dynamic list. And it’s an organic list.

“It’s dynamic for equipment and organic for those items that you like to eat. So it’s a dynamic, organic list and it will be subject to review when necessary,” Lim said today.

“We need to study, where there will be financial implications. Any amendment to the list will have implications to the amount collected. It’s a matter of whether the implications will be big or not.”

Under SST, 5,612 goods will be imposed a sales tax of 10%, while another 793 goods, 5%. A total of 5,443 consumer items are exempt from the tax.

In comparison, 11,197 goods were covered under GST, which was introduced by the previous Barisan Nasional administration in April 2015, and zero-rated on June 1 this year before being eventually repealed.

Lim defended the government’s move to implement the tax on Saturday despite not finalising the list.

“It’s not the most ideal of situation otherwise the country will be operating in deficit. We lack resources, manpower and expert advice. We have to explain to 80,000 (businesses) who have registered. But that’s better than not explaining to 472,000 (taxed) under the GST.”

Lim said the list will be continued to undergo review until the year’s end, following private meetings with business owners nationwide.

Lim has visited Penang, Ipoh, Malacca, Johor Baru, Sabah and will hold a meeting in Seremban tonight.

“We hold these sessions. It was never before done by the finance minister. We say we are not going to punish them, whether it was a honest mistake or not.

“We are going with the soft approach as a government who is attentive to the business owners. There will be no punishment like fines or jail sentences.

“The SST is a much softer, kinder, gentler tax compared to the GST. It should be better than GST, unless it’s a luxury item. Then you ‘kena’. But people who can afford it should pay.”

Custom deputy director Paddy Abdul Halim announced today the department has produced a guide on the proposed sales tax rate for various goods which listed 3,564 common consumer goods. The list can be found at https://mysst.customs.gov.my.

He added that it was a non-exhaustive list, which does not include items that are included or excluded from the tax and said a final guide will eventually be announced. – September 3, 2018.