Traditional and complementary medicine (TCM) practitioners who are registered under the T&CM Act 2016 [Act 775] will be exempted from the eight percent service tax, according to the Finance Ministry.
“As long as the TCM practitioners are registered with the Act under the Health Ministry, they will be exempted from the service tax that will come into effect on March 1, 2024,” Finance Minister II Amir Hamzah Azizan told Bernama during a special interview today.
He said in line with this decision, TCM practitioners who have registered with the T&CM Act 2016 [Act 775] do not need to register with the Royal Malaysian Customs Department and subsequently do not impose the service tax on the following services: Malay Traditional Medicine, Chinese Traditional Medicine, Indian Traditional Medicine, Homeopathy, Chiropractic, Osteopathy, and Islamic Medical Practices.
“The Finance Ministry has also agreed that this decision applies to services provided by medical or wellness centres, massage parlours, or such other places managed by TCM practitioners registered with Act 775 for the aforementioned services for the period before March 1, 2024,” he said.
Commenting on the government’s decision, Amir said this was following the decision by the Finance Ministry so that the services provided by medical or wellness centres, massage parlours or such other places managed by TCM practitioners registered under the T&CM Act 2016 [Act 775] are not categorised as taxable services, effective March 1, 2024.
“This feedback also takes into account discussions from engagement sessions with stakeholders of the TCM industry,” he said.
According to Amir, the service tax exemption for TCM services is one of the efforts to increase the people’s wellbeing as has been stressed in the Malaysia Madani concept and incorporated in the Madani Economy Framework: Empowering the People.
“The decision which has been agreed by the Prime Minister and Finance Minister Anwar Ibrahim is a move to improve the comfort and wellbeing of the people.
“At the same time, the Madani Economy Framework will also aggressively empower the Micro, Small and Medium Enterprises (MSMEs) sector which employs almost half of the workforce in Malaysia,” he said.
Amir said the government agreed that there is still a long way to expand the local MSMEs to the international arena.
“As such, these entrepreneurs are dependent on domestic demand for their business survival at present, more so for MSMEs which provide services to Malaysian citizens,” he added.
Tax remissions
Meanwhile, Deputy finance Minister Lim Hui Ying said TCM practitioners who have collected service tax since 2018 are required to submit and remit them back to the government.
She added that those who have not collected the tax have to declare it to the Customs Department.
“We are not going to track back. If you have collected from your patients (the service tax), you have to remit to the government whatever you have collected,” she said in a press conference after attending the Creative KL Grants Programme and Urban Challenge Award Ceremony today.
She explained that TCM practitioners have been included in the service tax since 2018 as those that have RM500,000 in revenue in a year are supposed to register and pay the tax accordingly.
“Not only Chinese TCM but there are other seven services also recognised by the Health Ministry, so that is why we are meeting them and the Health Ministry - as the regulator - has recognised these seven categories to be exempted from the service tax,” she said.
- Bernama
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