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Malaysia Tariff and tax information

Malaysia tariff and tax information, export documentation and how to do business in Malaysia.

Malaysia Tariff and tax information

Postby bridgat » Sun Nov 16, 2008 1:42 pm

The following information pertains to the customs duties and taxes of Malaysia. Duties and taxes are assessed by the Malaysian Government at the time of importation into Malaysia. Duties and taxes increase the cost of any product sold to a buyer located in Malaysia.

Malaysia assesses tariff duties on the Cost, Insurance and Freight (CIF) value of the product being shipped. The "C" in CIF represents the price/cost of the goods charged the buyer (importer) by the seller (exporter) for the product, in other words, the invoice price. (However, it is important to note that when reporting the value of the product to Customs it may be necessary to adjust that value based on the nature of the sale (e.g., if the sale is between two affiliated companies), and on a case by case basis.) The "I" represents any insurance fees paid to cover the shipment (over and above those insurance fees already included in the frieght charges). The "F" represents the Freight charges to get the product from the exporter to the importer. By adding up each of these values you will have the CIF, or Customs, value of the product.

Import Duties
All imported products must clear Customs and are subject to duties and general taxes. Duties are generaly assessed as an ad valorem rate (i.e., a percentage) assessed on the Customs value discussed above (e.g., CIF Value * 10% = duty owed). Rates of duty vary based on commodity type as classified by the international tariff classified system (Harmonized System).

Malaysian import duties range from 0 percent to 50 percent with the the average duty rate being around 8.5 percent. In general, higher rates are applied to luxury goods and protected sectors, and lower rates for raw materials.

Sales Tax
When goods are imported to Malaysia they are also subject to a general sales tax that varies by product. The rates are 5 percent, 10 percent, and 15 percent. The most common rate is 10 percent. This sales tax is assessed on the CIF value plus the assessed duty amount (i.e., (CIF value + (CIF value * duty rate)) * sales tax, such as, 10%).
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Re: Malaysia Tariff and tax information

Postby qszheng_forum » Mon Dec 22, 2008 2:28 am

TAX: Sales tax varies by product: 5, 10 or 15 percent with 10 percent being the most common. It is applied on CIF + duty.
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