PETALING JAYA – Construction services and building material costs will not be charged under the Sales and Service Tax (SST), said Finance Minister Lim Guan Eng.
In a statement on Sunday (Aug 12), Lim said basic materials such as bricks, cement, sand and other construction materials were subjected to the Goods and Services Tax (GST) at 6%, with the same applying to construction services.
“This had led to increased construction costs under the GST era, including the increase in house prices,” he added.
Lim expects the pressure on house prices, industrial and commercial buildings is to be eased by the abolition of GST and the exemption of SST.
The Federal Government, said Lim, hopes that the construction costs can be reduced with the exemption of SST.
Some of the building materials that will not be subjected to SST are cement, sand and iron.
“With the proposed exemption of goods from SST and the difference in GST implementation, I hope both the developers and the buyers can benefit from the reduction of this tax burden,” he added.
The reintroduced SST will kick in on Sept 1 to replace the GST.