PUTRAJAYA, June 20, 2025 – The Ministry of Finance (MOF) has addressed concerns raised by MSM Malaysia Holdings Berhad regarding the revised Sales and Service Tax (SST) on raw sugar, set to take effect on July 1, 2025, emphasizing that refined sugar (white sugar) will remain exempt from taxation.
In a statement yesterday, MOF reiterated the MADANI government’s targeted approach to shield essential goods from the SST revision. Items such as sugar, salt, chicken, eggs, meat, fish, vegetables, cooking oil, and rice will not be taxed to minimize the impact on the public.
While raw sugar used in producing refined sugar will incur a 5% sales tax, MOF clarified that manufacturers like MSM can apply for tax exemptions on raw materials and inputs. These exemptions are provided under Item 1, Column (2), Schedule B of the Sales Tax (Persons Exempted from Payment of Tax) Order, administered by the Royal Malaysian Customs Department.
“There is no basis for any price increase in refined sugar,” the ministry stated, noting that sugar refiners like MSM continue to receive monthly government incentives to ensure stable supply and pricing.
MOF urged sugar refiners and manufacturers to apply for the tax exemptions to maintain cost stability. The ministry’s clarification aims to allay public concerns over potential price hikes amid the upcoming SST changes.