Customs legislation and the legal framework in Malaysia has largely remained unchanged since the late sixties/early seventies, with the exception of implementation of WTO valuation rules, setting up of Customs Appeal Tribunal, introduction of Advance Customs Rulings in 2000, and the Strategic Goods Act in 2010. Customs laws are administered by the Royal Customs Department of Malaysia, an agency under the Ministry of Finance.
Malaysia Customs has a growing focus on post import audit activities and retroactive duty claims as a result of incompliance or weak classification and valuation positions. Duty revenue is reducing due to its fast expanding Free Trade Agreements network in recent years, perhaps causing Customs to take a more pro-active approach to assessing compliance.
The Ministry of International Trade and Industry (MITI) is the key regulator of trade policy including trade remedies (antidumping and countervailing, safeguard measures). MITI is responsible for regulation of the manufacturing sector, issues import / export license (amongst several other authorities), is the lead agency in negotiation of Free Trade Agreements and the authority for the endorsement of Preferential Certificates of Origin.The Strategic Trade Secretariat, the office that administers Export Controls, is also MITI.
In response to the development of more sophisticated business models, basic regulations and prescribed procedures (some introduced more than 30 years ago) are often complemented with a number of administrative procedures or “guidelines/schemes” to facilitate trade, with growing reliance on on-line processes. However, some of these procedures or modifications are not always reflected in legislation or are well documented in up-to-date, reliable materials. Therefore, in practice, consultation initiated by a company with the Authorities followed by a written “approval” is often necessary to obtain clarity.
Manoeuvring through the legal framework and these administrative procedures is often not a straightforward process and can be frustrating for companies to balance sustainability, optimise processes, and continue compliance.
We focus on providing the best solutions to your company to achieve customs efficiency and strategic customs planning opportunities. We specialise in the following areas:
The Royal Malaysian Customs Department (RMCD) released a notice on 10 March 2023 stating the postponement of the imposition of sales tax and excise duties on LVG and premix preparations, respectively. Previously, the imposition of such taxes would take effect on 1 April 2023, however, it will be postponed to a date...
On 2 November 2018, the Malaysia Minister of Finance tabled the 2019 National Budget.
Effective 1 June 2018, the rate of GST will be reduced from six to zero percent. GST on importation of goods and removal of goods from Free Zone to the Principal Customs Area (Malaysia except Langkawi, Labuan and Tioman), for example, are now set at zero percent.
Effective 1 August 2017, the Customs (Prohibition of Imports) (Amendment) Order 2017 took effect.
As reported in our Trade Intelligence Asia Pacific (December 2016- January 2017) publication, the European Commission has adopted Commission Delegated Regulation (EU) 2420/2015, updating EU’s list of dual-use items (Annex 1 to Council Regulation (EU) No.428/2009).
Further clarification that the 90 items/HS codes will be granted import duty exemption under Item 117 of the recently gazetted Customs Duties (Exemption) (Amendment) (No.3) Order 2015.
Chandrasegaran Perumal
Director, Malaysia, PwC Asia Pacific Customs and Trade
Tel: +60 (3) 2173 3724