Kuala lumpur: The Ministry of Plantation and Commodities (KPK) will hold an engagement session with palm oil industry stakeholders on July 3, said Deputy Minister of Plantation and Commodities, Datuk Chan Fong Hin. He emphasized that the meeting aims to address various concerns regarding the implementation of the Sales and Service Tax (SST), with a particular focus on the interpretation of final products.
According to BERNAMA News Agency, the session is intended to help all parties within the relevant sectors gain a clearer understanding of the SST’s impact on the supply chain and commodity production. Despite earlier discussions with the Ministry of Finance, some issues remain unresolved, prompting the ministry to step in to assist stakeholders in comprehending the actual challenges they face.
Chan highlighted that confusion arises from interpreting final products, particularly when products from one factory serve as raw materials for another. The government’s intention is not to pass costs onto consumers, but this often happens as expenses flow through the supply chain. The challenge lies in defining a final product when it simultaneously acts as raw material for another entity.
Addressing the proposal from the Malaysian Rubber Glove Manufacturers Association (MARGMA) to delay the 5 percent SST on natural rubber latex and nitrile butadiene rubber latex, Chan acknowledged that no solution has been found yet. However, the ministry remains open to suggestions to resolve the issue. MARGMA has warned that implementing the SST could affect the domestic rubber industry ecosystem, impacting SMEs’ cash flow, slowing innovation, and challenging Malaysia’s standing as a global glove manufacturing hub.
In his speech at the Food and Drinks Malaysia (FDM) 2025 exhibition, Chan also touched on the global shortage of cocoa beans and the rising demand for sustainable and traceable cocoa. Malaysia is actively working to revive cocoa plantation development through the Malaysian Cocoa Board, aiming to increase land area and upstream bean production. The initiative seeks to attract investors, cooperatives, and plantation players to participate in this national effort.
Chan noted Malaysia’s shift towards premium cocoa varieties to meet niche global demands, focusing on fine-flavour beans, single-origin selections, and organic options to position Malaysian chocolate at the high end of the value chain.