GST to be imposed on digital streaming services

SHAH ALAM: Digital streaming services such as Netflix and iflix are among items expected to be taxed under the proposed amendments to the Goods and Services Tax (GST) Act to incorporate the digital economy.
Customs Director-General Datuk Seri Subromaniam Tholasy said the latest amendments on the GST Act had been submitted to the Finance Ministry.
He added the inclusion of the digital economy would likely contribute an additional few billion to the government's annual GST collection.
However, the particulars on the taxing of the digital economy still remains unknown.
"We have made engagements with the industry players and other parties (on the amendment)," he told a press conference after attending the Malaysia Customs Directors Meeting at the Grand Bluewave Hotel.
On Sept 19, the department had said that it was looking to propose the amendments when the Dewan Rakyat reconvenes at the end of this month.
Subromaniam said the government would be losing a large source of revenue if it was not able to impose a tax on the digital economy.
He added the old tax regime, Sales and Services Tax (SST), would not be able to tap into the digital industry as it was considered obsolete.
"Sometimes, people do not understand why the government implemented GST. We cannot collect revenue from the digital economy under the SST.
"If we revert to SST, we will lose a source of income as everything is going to be digital and we won't be able to tax it," he added.

He also called for critics of GST to leave matters pertaining to taxation to the professionals.
Meanwhile, Subromaniam said his department would initiate the GST ambassadors programme beginning Oct 15 aimed at assisting businesses in making their tax filings accordingly.
He added officers well-versed in GST would be stationed in business chambers and associations, where business owners could visit the places for consultations.
He urged businesses to take up the chance to comply with the proper guidelines before the department took a more aggresive approach starting next year.