Kuala lumpur: The Ministry of Finance (MoF) announced today that, after carefully considering public sentiment, it has decided not to proceed with the proposed expansion of the Service Tax to beauty services such as manicures and pedicures, facial services, and barbers and hairdressers.

According to BERNAMA News Agency, the MoF stated that all revisions to the expanded Sales Tax and Service Tax were made after taking into account feedback from the public and industry. The Ministry emphasized its commitment to engaging with the public and stakeholders to refine tax policies. Since the announcement on June 9, 2025, regarding the revision of the Sales Tax and Service Tax (SST), the MADANI Government has been attentive to feedback from the rakyat and has actively engaged with industry representatives on the proposed expansion of the SST.

The Ministry highlighted its efforts to gather input by engaging with a number of backbenchers yesterday to understand grassroots feedback, as mentioned in a statement released today.

In a related development, select imported fruits will be exempt from the Sales Tax. The Prime Minister and Minister of Finance, Datuk Seri Anwar Ibrahim, has agreed to exempt imported apples, oranges, mandarin oranges, and dates from the Sales Tax after considering public feedback. The MoF reiterated the MADANI Government’s stance on not imposing Sales Tax on daily essential goods to alleviate the cost of living pressures on the majority of Malaysians. Essential goods such as rice, chicken, beef, vegetables, and eggs, along with local fish varieties like selar, tongkol, cencaru, and sardines, whether frozen, chilled, or fresh, will remain exempt from Sales Tax.

Additionally, to ease the burden on businesses, the Prime Minister has decided to increase the registration threshold for the Service Tax from RM500,000 to RM1 million for leasing or rental and financial services. This adjustment means only businesses with sales exceeding RM1 million will be required to pay the Service Tax on rental services, providing relief to more Micro, Small, and Medium Enterprises (MSMEs).

The MoF calls on all parties to make responsible and informed statements on the SST and encourages referring to official communication channels, including public announcements, infographics, subsidiary legislation, general rulings, guidelines, and frequently asked questions (FAQs) issued by the MoF and the Royal Malaysian Customs Department. Members of the public and businesses may also contact the SST Call Centre at the Royal Malaysian Customs Department for further information.