Commencement of amendments to the Goods and Services Tax Act 2014
s 40
This Chapter comes into operation on 1 January 2017.
Finance Act 2017 ChApTER VI — AMENDMENTS TO ThE GOODS AND SERVICES TAX ACT 2014
Amendment of section 2
s 41
The Goods and Services Tax Act 2014, which is referred to as the “principal Act” in this Chapter, is amended in section 2— (a) in the definition of “money”, by substituting for the full stop a semicolon; and (b) by inserting after the definition of “money” the following definition: ‘ “free zone” has the meaning assigned to it in subsection 2(1) of the Free Zones Act 1990 [Act 438].’.
Amendment of section 13
s 42
Paragraph 13(4)(b) of the principal Act is amended by substituting for the words “issued by” the words “received from”.
Amendment of section 20
s 43
Subsection 20(6) of the principal Act is amended— (a) in paragraph (a), by inserting after the words “to be supplied” the words “due to cessation of business”; (b) in paragraph (d), by deleting the word “or” at the end of the paragraph; (c) in paragraph (e), by substituting for the full stop at the end of the paragraph the words “; or”; and (d) by inserting after paragraph (e) the following paragraph: “(f) supply of goods made within or between the free zone under section 162 except where such supply is subject to an order under subsection 163(1).”.
Amendment of section 33
s 44
Section 33 of the principal Act is amended— (a) by substituting for subsection (10) the following subsection: “(10) No invoice showing an amount which purports to be a tax shall be issued by any registered person— (a) on any supply of goods or services which is not a taxable supply; or (b) on any zero-rated supply.”; (b) by inserting after subsection (10) the following subsection: “(10A) Any person who is not a registered person, except the persons mentioned in subsections 65(4) and (5), shall not issue— (a) an invoice showing an amount which purports to be a tax or an amount inclusive of tax; or (b) an invoice which purports to be a tax invoice with or without tax.”; and (c) in subsection (11), by inserting after the words “subsection (10)” the words “or (10A)”.
New sections 34a and 34b
s 45
The principal Act is amended by inserting after section 34 the following sections: “Prescribed registered person to provide information on supply made and payment received 34a. (1) Any registered person as prescribed by the Minister shall provide information on all supply made and payment received by the registered person to the Director General using a device and in the manner as prescribed by the Minister. (2) The Director General may for the purpose of this section approve any person— (a) to install, configure and integrate the prescribed device; (b) to provide the services for the support and maintenance of the prescribed device as scheduled or upon being notified of the failure of the prescribed device to function or operate in normal condition; or (c) to carry out an inspection in the case of any sign of interference, destruction, damage, manipulation of data stored or obstruction of the lawful use of the prescribed device. (3) The person approved under subsection (2) shall, when entering the premises of the registered person prescribed under subsection (1) to perform his duties under this section, produce, on demand by the registered person, proof of approval. (4) The registered person prescribed under subsection (1) shall— (a) at any time allow any officer of goods and services tax or any person approved by the Director General to install the device and to configure, integrate or inspect the device installed at the registered person’s business premises; (b) make all effort to ensure— (i) that the device, after being supplied and installed, is not moved, manipulated, tampered or interfered with; and (ii) that the use of the device is not obstructed by any person or any other device; and (c) notify immediately the Director General of any failure of functionality and operation of the prescribed device in normal condition. (5) Any person who fails to comply with, hinder or prevent the operation of this section in any respect commits an offence. Duty not to give, publish or disclose information of the prescribed device 34b. (1) Any person who, for any reason, has by any means access to any information on the device prescribed under subsection 34A(1) shall not give, publish or otherwise disclose to any other person such information unless the disclosure is required or authorized— (a) under this Act; (b) by any court; or (c) for the performance of his duties or the exercise of his powers under this Act. (2) Any person who contravenes subsection (1) commits an offence.”.
Amendment of section 41
s 46
Subsection 41(8) of the principal Act is amended— (a) by inserting after the words “not paid” the words “wholly or partly”; (b) in paragraph (a)— (i) by inserting after the words “not paid” the words “wholly or partly”; (ii) by substituting for the word “five” the word “ten”; (iii) in the national language text, by inserting after the words “amaun cukai” the word “itu”; and (iv) by substituting for the words “due and payable” the words “remain unpaid”; (c) in paragraph (b)— (i) by inserting after the words “not paid” the words “wholly or partly”; (ii) by substituting for the word “ten” the word “fifteen”; (iii) in the national language text, by inserting after the words “amaun cukai” the word “itu”; and (iv) by substituting for the words “due and payable” the words “remain unpaid”; and (d) in paragraph (c)— (i) by inserting after the words “not paid” the words “wholly or partly”; (ii) by substituting for the word “ten” the word “fifteen”; (iii) in the national language text, by inserting after the words “amaun cukai” the word “itu”; (iv) by substituting for the words “due and payable” the words “remain unpaid”; and (v) by deleting the words “, subject to a maximum penalty of twenty-five per cent of the amount of tax due and payable”.
Amendment of section 42
s 47
Section 42 of the principal Act is amended— (a) in subsection (1), by substituting for the words “section 58” the words “subsection 56(5)”; and (b) by inserting after subsection (3) the following subsections: “(4) Where any tax due and payable is not paid wholly or partly by any person other than a taxable person after the last day on which it is due and payable under subsection (1) and no prosecution is instituted, the person shall pay— (a) for the first thirty-day period that the tax is not paid wholly or partly after the expiry of the period specified in subsection (1), a penalty of ten per cent of the amount of tax remain unpaid; (b) for the second thirty-day period that the tax is not paid wholly or partly after the expiry of the period specified in subsection (1), an additional penalty of fifteen per cent of the amount of tax remain unpaid; and (c) for the third thirty-day period that the tax is not paid wholly or partly after the expiry of the period specified in subsection (1), an additional penalty of fifteen per cent of the amount of tax remain unpaid. (5) Subject to subsection (7), prosecution for the offence under subsection (3) may be instituted after the expiry of the period specified in paragraph (4)(c). (6) The court may order that any person other than a taxable person who is convicted for the offence under subsection (3) shall pay the penalty as specified in subsection (4). (7) No prosecution for the offence under subsection (3) shall be instituted against any person other than a taxable person who has paid the amount of tax due and payable and the penalty specified under subsection (4) within the period specified in subsection (4).”.
Amendment of section 49
s 48
Paragraph 49(1)(b) of the principal Act is amended by substituting for the words “section 21” the words “sections 21, 41 and 42”.
Amendment of section 51
s 49
Subsection 51(1A) of the principal Act is amended by inserting after the words “subsection 41(8)” the words “or 42(4)”.
Amendment of section 56
s 50
Section 56 of the principal Act is amended— (a) in subsection (5), by inserting after the words “was granted” and “fulfilled” the words “, or where the relief granted is revoked”; and (b) by inserting after subsection (6) the following subsection: “(7) Where a person who has been granted relief under subsections (1) and (3) has paid any of the tax to which the relief relates and has been granted approval by the Minister to a refund of the amount of tax which has been paid, the person shall be entitled to such refund.”.
Amendment of section 57
s 51
Section 57 of the principal Act is amended— (a) in the shoulder note, by substituting for the words “overpaid or erroneously paid” the words “overpaid, erroneously paid, remitted or being the subject of relief”; (b) by substituting for subsection (1) the following subsection: “(1) Any person who— (a) has overpaid or erroneously paid any tax, surcharge, penalty, fee or other money; or (b) is entitled to a refund of tax under subsection 56(7) or refund of tax, penalty or surcharge under subsection 62(3), may make a claim thereof in the prescribed form.”; and (c) by inserting after subsection (1) the following subsections: “(1A) A claim under subsection (1) shall be made to the Director General within six years from the time— (a) such overpayment or erroneous payment occurred; or (b) such entitlement of the refund under subsection 56(7) or 62(3) occurred. (1b) The Director General may make such refund of tax, surcharge, penalty, fee or any other money, as the case may be, after being satisfied that the person has properly established the claim.”.
Amendment of section 70
s 52
Section 70 of the principal Act is amended— (a) by substituting for subsection (1) the following subsection: “(1) In relation to goods that have been approved by the proper officer of customs to be deposited in a warehouse, there shall be a scheme to be known as the “Warehousing Scheme” which allows— (a) tax due and payable on the goods that have been imported to be suspended when such goods are deposited in the warehouse; and (b) tax chargeable on any supply of taxable goods made within or between the warehouse to be disregarded.”; (b) by inserting after subsection (1) the following subsection: “(1A) The Warehousing Scheme under subsection (1) shall not be applicable to goods as may be prescribed.”; (c) by substituting for subsection (2) the following subsection: “(2) Tax shall be due and payable upon all goods removed from a warehouse to all intents as if the removal were importation into Malaysia unless the goods are removed for export, for deposit to another warehouse, to a free zone or to a designated area with the approval of the proper officer of customs.”; (d) by deleting subsection (3); (e) in subsection (4)— (i) by deleting the words “from a Warehousing Scheme”; (ii) by substituting for the words “and duty” the words “from a warehouse”; (iii) in paragraph (b)— (A) by deleting the words “customs warehouse or licensed” wherever appearing; and (B) in the national language text, by substituting for the word “disimpan” the word “dideposit”; and (iv) in paragraph (c), by inserting after the word “Malaysia” the words “for removal to a designated area or to a free zone”; (f) by deleting subsection (5); and (g) in subsection (7), by deleting paragraph (d).
Amendment of section 72
s 53
Subsection 72(3) of the principal Act is amended by inserting after the words “taking place at” the words “whichever is”.
Amendment of section 73
s 54
Subsection 73(3) of the principal Act is amended by inserting after the words “taking place at” the words “whichever is”.
Amendment of section 103
s 55
Subsection 103(5) of the principal Act is amended by substituting for the words “For the purposes of section 83, where” the word “Where”.
Amendment of section 156
s 56
Section 156 of the principal Act is amended— (a) in paragraph (a)— (i) by substituting for the word “supplied” the word “removed”; (ii) by inserting after the words “designated area” the words “to another designated area through Malaysia or from a designated area”; and (iii) by substituting for the word “supply” the word “removal”; and (b) by inserting after paragraph (a) the following paragraph: “(aa) the payment of tax under paragraph (a) shall be suspended on any goods removed from a designated area through Malaysia to another designated area, to a free zone or to a warehouse under section 70, unless the Minister otherwise directs in an order under section 160.”.
Amendment of section 160
s 57
Section 160 of the principal Act is amended by substituting for subsection (1) the following subsection: “(1) The Minister may, by order published in the Gazette, prescribe— (a) any supply of goods or services within or between the designated areas to be chargeable to tax; (b) any goods imported into a designated area, or removed from a designated area through Malaysia to another designated area, to a free zone or to a warehouse under section 70, to be chargeable to tax; or (c) any services imported into a designated area to be chargeable to tax.”.
Amendment of Part XV
s 58
Part XV of the principal Act is amended in the title, by substituting for the words “FREE COMMERCIAL ZONE” the words “FREE ZONE”.
Amendment of section 161
s 59
Section 161 of the principal Act is amended— (a) in the definition of “Malaysia”, by deleting the word “commercial”; (b) by inserting after the definition of “Malaysia” the following definition: ‘ “manufacture” has the meaning assigned to it in section 2 of the Free Zones Act 1990.’; and (c) by deleting the definition of “free commercial zone”.
Amendment of section 162
s 60
Section 162 of the principal Act is amended— (a) in the shoulder note, by substituting for the words “from free commercial zone” the words “within or between free zone”; (b) by inserting after the words “this Act” the words “and unless the Minister otherwise directs in an order under section 163”; (c) in paragraph (a)— (i) by substituting for the words “free commercial zone” wherever appearing the words “free zone”; (ii) by substituting for the words “except for goods used” the words “except for goods imported to be used or consumed”; and (iii) by inserting after the words “purpose of commercial” the words “, manufacturing”; and (iv) by inserting at the end of the paragraph the word “and”; (d) by substituting for paragraph (b) the following paragraph: “(b) no tax shall be charged on any supply of taxable goods made within or between a free zone.”; and (e) by deleting paragraph (c).
New sections 162a and 162b
s 61
The principal Act is amended by inserting after section 162 the following sections: “Goods removed from a free zone including goods under lease agreement 162 a . (1) Tax shall be due and payable upon all goods removed from a free zone to another free zone through Malaysia or from a free zone to Malaysia including any goods under lease agreement as if the removal were importation into Malaysia. (2) Unless the Minister otherwise directs in an order under section 163, the payment of tax under subsection (1) shall be suspended on any goods removed from a free zone through Malaysia— (a) to another free zone; (b) to a designated area; or (c) to a warehouse under section 70. Supply of goods or services by taxable person whose principal place of business located in a free zone 162 b . Tax shall be charged by a taxable person whose principal place of business is located in a free zone on any taxable supply of goods or services made within Malaysia.”.
Amendment of section 163
s 62
Section 163 of the principal Act is amended— (a) by substituting for the shoulder note the following shoulder note: “Power of Minister to impose tax”; and (b) by substituting for subsection (1) the following subsection: “(1) The Minister may, by order published in the Gazette, prescribe— (a) any goods imported into, supplied within or between free zone to be chargeable to tax; or (b) any goods removed from a free zone through Malaysia to another free zone, to a designated area or to a warehouse under section 70 to be subject to payment of tax.”.
Amendment of Second Schedule
s 63
The Second Schedule to the principal Act is amended by inserting after paragraph 7 the following paragraph: “Supply of land in compliance with requirement of written law, Government or local authority 8. (1) Any supply of land by a developer or an owner of the land to the Federal Government, a State Government, a local authority or any other person in compliance with the requirement of any written law, the Federal Government, State Government or local authority for the purposes of providing public amenities and public utilities whether for no consideration or at nominal value shall be treated as neither a supply of goods nor supply of services. (2) For the purposes of subparagraph (1), public amenities and public utilities means the amenities and utilities provided in the layout plan for a project which has been approved by the relevant local authority.”. DICETAK OLEH PERCETAKAN NASIONAL MALAYSIA BERHAD, KUALA LUMPUR BAGI PIHAK DAN DENGAN PERINTAH KERAJAAN MALAYSIA
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Source: Laws of Malaysia, Attorney General's Chambers of Malaysia (lom.agc.gov.my). Not a copy of the Gazette printed by the Government Printer (Interpretation Acts 1948 and 1967, s 61).
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