GST and Service Charge in Malaysia

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GST was reduced to 0% on 1 June 2018 and was replaced with the Sales Tax and Service Tax starting 1 September 2018. The Sales Tax is levied at the import or manufacturing levels, and companies with a sales value of taxable goods exceeding RM500,000 in a 12-month period are liable to be registered for the tax, which is levied at rates varying from 5% to 10% depending on the goods in question.

Old post:

Still remember a long time ago in the college learning how to do Accounting for GST and our lecturer told us that we will have the competitive advantage when the GST is implemented in Malaysia in the future. Now the time has come but unfortunately, I am not in the Accounts field anymore. :)

As you all probably know, the GST was implemented effectively on the 1st April 2015 in Malaysia at the rate of 6%. While GST is supposed to reduce the indirect tax and subsequently, the prices of goods and services will be reduced, I find that most of the prices of the goods and services have actually increased in Sabah.

Actually, only businesses with annual sales turnover of RM500,000 and above are liable to be registered under GST. Those below RM500,000 threshold are not liable but they can also register for voluntary registration. Some businesses do that to avoid having to absorb the GST on their expenses and purchases so that they can be more competitive.

Apart from GST, businesses such as hotels and restaurants can continue to collect 10% service charge from the customers provided there was a collective agreement (CA) between the empoyers and the workers and they are also advised to display a notice informing the consumers on the service charge imposed in their outlets. While the minimum wages are set at MYR 800, there are still many workers earned less than half of it so the service charge is necessary to meet the minimum wages for the workers.

Business Opportunities in Sabah

With high living cost and low wages/salary, we are forced to find a way to make more money to pay for our expenses. Some quit their job to do business when they see the opportunities, some busy mothers, government servants or officers start part time businesses. Some of them are quite successful.

Here are the 10 low cost part time job or businesses to do in Sabah. (It is just my personal opinion so please do your own research before you start your business)

1) FOOD - From a small food stall, kedai kopi, a franchise or even a fine dining restaurant, the demand is always there. What we need is some creativity and innovative ideas to come up with something different that can be our competitive advantage so that we don't have to issue the price war. :) Recently, in social media, some people started online catering and online bakery with free deliveries and the response has been positive. This is one example of low cost business that anyone with passion in cooking or baking can start almost immediately.

2) CHILD CARE - With rising expenses, stay at  home mothers are forced to find a job. Thus child care demand is increasing. Those who have free time can offer baby sitting services at hourly rate or daily or monthly rate. Of course, it takes great patience to be in this field. This is definitely not for impatient person like me. :P

3) MAKE UP ARTIST - Either work in Bridal or do freelance. However, you may need to update yourself regularly to the latest trend.

4) MLM - If you have good social network, Multi Level Marketing may work for you. You may need to find the one with good products and good incentive.

5) ONLINE DROPSHIP - No capital required, you just need to market the products on social media or direct selling. The buyer will pay you and you will pay the seller. The seller will then send the product to the buyer directly.

6) FLORIST - If you are creative and like doing floral art, with basic knowledge in florist, you can sell bouquet of flowers for graduation, special occasions such as Mother's Day, Valentine Day, or even do wedding floral decorations.

7) JOURNALISM - If you are good at writing, why not try to write articles for local newspapers or magazines? Some offer really good incentive when your articles get published.

8) GARDENING - If you have a green thumb, try planting vegetables or flowers. You can then sell your vegetables and plants in the local market.

9) FREELANCE PROPERTY NEGOTIATOR - Buying and selling properties are fun for those who love traveling and meeting people.

10) FREELANCE TOUR GUIDE - You will need to pass the test but if you love adventure and traveling and meet people from around the world,

Well, from experience, I would say, everything in business is trial and error. We improve from our mistakes. Enjoy the process and one day, you may achieve something you never think you can. Don't be afraid to take the first step. Good Luck and All the Best!