Effective 1 January 2011

• The rate of Service Tax will be increased from 5% to 6%; and
• Service Tax will be levied on Paid Television Broadcasting Services.

The Honourable Finance Minister during the budget 2011 speech had announced that the rate of service tax will be increased from 5% to 6% with effective from 1 January 2011 excluding credit cards and charge cards.

The Honourable Finance Minister also announced that service tax will be levied on Television Broadcasting services where charges are imposed effective from 1 January 2011. (Refer to Attachment 15 & 16 of the Budget Speech Text) That is, beginning 1 January 2011 service tax will be charged at the rate of 6% on the monthly subscription fees for Paid Television Broadcasting Services.

The relevant legislation (Regulations and Order) is in the process of Gazetting. Implementation guide lines will be issued in due course by the Internal Tax Division, Royal Malaysian Customs, Head Quarters.