KUALA LUMPUR – The Finance Ministry has scrapped plans to expand the service tax to personal grooming services like haircuts, manicures, pedicures and facials, following public concern.
In a statement today, the ministry said the decision came after taking into account strong feedback from the public, business owners and lawmakers. The original proposal was announced on June 9 as part of changes to the Sales and Service Tax (SST).
“The Madani government has been monitoring public response closely and has also held discussions with industry players,” it said. Engagements with government backbenchers were also held yesterday to better understand grassroots concerns.
This follows the government’s announcement on Thursday that it would exempt specific imported fruits – namely apples and oranges – from the sales tax, also in response to public concern.
Prime Minister Datuk Seri Anwar Ibrahim said the exemption aimed to ensure affordable access to healthy food options, especially for lower-income households, while continuing to promote the consumption of local fruits such as guava, rambutan and durian.
“Some still want to eat apples and oranges because they are cheaper,” Anwar said, adding that the government had listened to the people’s concerns during a Cabinet meeting. He also stressed that local fruits remain a priority in national food policy.
At the same event, Anwar announced the government would raise the sales threshold for micro enterprises and small traders from RM500,000 to RM1 million – a measure that has now been extended to cover rental, leasing and financial services under the SST.
With the updated threshold, only businesses with more than RM1 million in annual sales from these services will need to register and charge the Service Tax. The move is expected to ease the burden on more micro, small and medium enterprises (MSMEs), particularly those in the rental sector.
The Finance Ministry reminded the public to rely on official communication channels for verified information on the SST, including updates from the Royal Malaysian Customs Department. Businesses with questions can contact the SST Call Centre. – June 27, 2025