PETALING JAYA: While the government has given some information on the 10% sales tax for low-value goods (LVG) that is now in effect, much more detailed information should be forthcoming in order to assist importers, says the Airfreight Forwarders Association of Malaysia (Afam).
Underlining the challenges involved in streamlining the process with all stakeholders, Afam even appealed to the government to defer the implementation of the tax, just days before it took effect from yesterday.
It noted that a reasonable extension was necessary to facilitate a smooth transition to the sales tax.
The association, which represents 112 companies nationwide, expressed its concerns in a letter dated Dec 27 to the Finance Ministry and related government agencies.
In the letter signed off by its secretary Anuar Ashaari, Afam also said there was a huge need for a sufficient and formal written notice from the relevant agencies to minimise confusion for businesses and the industry at large regarding the tax move.
“We hope the ministry will not permit the continuation of such culture and practices,” it said, referring to late or insufficient notices.
Anuar said the new LVG implementation was no simple task and applicable across the industry, universal to all goods via air, sea and land, for an entry value threshold below RM500.
The introduction of LVG would require proper guidelines, training and testing in this new segment through the current Customs portals, he said.
“Such fundamental changes necessitate careful study, dialogue, feedback from the industry and a clear timeline for training and system tests before implementation to prevent major issues and collapse of such clearance process as had been apparent in the past with uCustoms and GST, which we should by all means try and avoid,” he said.
The proposed changes, said Anuar, had not undergone any trials, testing or pilot runs to date, and the two-month time frame, commencing Oct 17, 2023, was insufficient for a comprehensive collaboration with both customers and global team members.
“There are configurations that need to be done at the courier’s system to allow for integration and use of the ePAM system, among others,” he said.
E-PAM, or electronic Pre-Alert Manifest, was introduced by Customs a few years back to improve speed, efficiency and streamlining of customs clearance procedures by allowing courier service companies to make a simplified import declaration for multiple importers at once before the arrival of goods.
Afam said a seamless collaboration with Customs for LVG registration was imperative to avert potential issues including double taxation and penalties that might arise from non-compliance.
When contacted, Thomas Matthew, Afam adviser (customs and regulatory), said following its Dec 27 letter, the Customs Department had reiterated that there would not be any change to the implementation date.
He also said the courier ePAM module might take a few weeks after Jan 1 before it would be ready, based on the vendor.
