Finance Minister Lim Guan Eng said the change was made to take into account feedback from restaurant owners who were unhappy with the initial threshold.
“We’ve taken into account all their requests. We will increase the threshold for all eateries and restaurants to RM1.5 million.
“If their turnover is more than RM1.5 million, then they pay the tax. This is final,” he said at a press conference here today.
The SST, which replaces the 6% goods and services tax (GST) introduced by the previous government in 2015, comes into effect on Sept 1.
It will see selected items subject to a 5% or 10% tax while services will be subject to a 6% tax. The government has said that with the SST, more items will be tax-exempt compared to the GST.
Lim said with the new threshold, prices should not increase except for big businesses with a turnover of RM1.5 million.
“Even construction materials are exempt from the SST,” he added. “We hope no parties will increase prices for this when it is exempt.”
He said there would also be price increases which the government would need to study.
“We will work on it from time to time,” he said. “Give us feedback. We will listen.”