The proposed High-Value Goods Tax (HVGT), initially slated to be implemented beginning May 1, has now been officially deferred. In a statement to The Star, Deputy Finance Minister Lim Hui Ying said the delay was needed as the government is still engaging with industry players to further refine the bill.
The HVGT bill was not introduced in the just-ended Parliament session to be tabled. The session is set to reconvene on June 24, but the ministry has yet to decide if the bill will be tabled at the next Dewan Rakyat sitting. “The government will announce the new implementation date of the HVGT later,” Lim said in the statement.
The ministry, she said, is in the final stage of refining certain aspects of the bill, including the definition of “high-value goods”, the price range of the items subject to the tax, as well as the exact tax rates.
First announced as the “luxury goods tax” in the revised Budget 2023 tabled in February last year, the HVGT is expected to carry a tax rate from 5% to 10%. However, the ministry has since been mum on the specific details of the HVGT, including what types of luxury items would fall under the said tax.
It is unclear at this time if the HVGT will be implemented for cars. Previously, only jewellery and watches were mentioned in the budget speech.
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Lim said that the ministry will be inclusive in formulating the HVGT policy by getting industry views and stakeholders’ feedback through more meetings. “This is to ensure that the policy would take into account various aspects including its impact on the economy, businesses and cost of living,” she added.
In her statement, Lim also said that the HVGT will “fundamentally” not affect low-income groups, as “they are unlikely to purchase high-value goods”. However, The Edge reports that jewellers have been vocal about the tax, with many saying that a big part of their customers are mostly folks from the working class who save up to purchase items like gold and jewellery for investment or celebratory purposes.
Prime Minister and the Minister of Finance, Datuk Seri Anwar Ibrahim, previously said that the government anticipates generating an additional RM700 million annually from HVGT.
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