The bill was passed with a majority voice vote.

This flat rate will be imposed on low-value goods (LVG) sold online – that are priced below RM500. This tax rate will be implemented next year.

The Bill was passed after a tense debate between deputy finance minister Shahar Abdullah and opposition MPs.

Shahar said the government was expected to collect RM200 million per year from the implementation of the tax.

He added that the tax would level the playing field between online sellers both inside and outside Malaysia, which would empower local markets and businessmen.

However, Lim Guan Eng (PH-Bagan) argued that the tax would be burdensome for low-income Malaysians who bought products online.

“We need to think about decreasing taxes, not increasing taxes for them (low-income Malaysians),” said Lim while debating the Bill.

He added that the tax would also discourage Malaysians from venturing into e-commerce.

Other PH MPs such as Wong Hon Wai (PH-Bukit Bendera) and RSN Rayer (PH-Jelutong) echoed Lim’s arguments.

Meanwhile, Cha Kee Chin (PH-Rasah) questioned whether the tax would affect the purchasing power of Malaysians and whether the finance ministry had conducted research on it.

Sabri Azit (PAS-Jerai) supported the Bill, saying it could stimulate the economy. However, he called for the 10% rate to be reduced.

“I hope that the tax rate can be reduced as it would add to customers’ costs.

“A reduced tax will better stimulate the economy and increase sales activities,” said the PAS MP.

When tabling Budget 2022 last November, finance minister Tengku Zafrul Aziz said a sales tax would be imposed on low-value goods sourced from overseas and sold through online platforms and delivered to the country.

Tengku Zafrul said the tax on online purchases would “level the playing field” for locally manufactured goods.

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