Service Tax in Restaurants

Posted by vivien | Kuala Lumpur and Selangor | Wednesday 24 June 2009 10:00 am
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Some restaurants charge service tax of 5%, whereas others 10%. Ever wonder how service tax works. According to The Star newspaper dated July 11, 2008, only restaurants earning more the 3 million per year(previously RM500,000 annum) can charge service tax, and this took effect July 1 last year.

However, seems like not all restaurants observe this, i doubt some small restaurants which i visited make more than 3 million a year 😛 but they do charge service tax. You could lodge complain at
1. cd [at] customs.gov.my or
2. kastam [at] customs.gov.my
According to article in Malaysia Royal Custom website, restaurants in hotel, nightclubs, dance halls, cabarets, health centre, massage palours, public houses and beer houses can charge service tax with no pre-requisite of annual earning 3 millions.
For full list of restaurant authorised to charge service tax, refer to Lowyat.net or Promotions and Sales in Malaysia.
One things which confuses things for me is this Service Tax Act specify 5% service tax is at stake, but at times restaurant charge 10% service tax.

 

2 Comments »

  1. Comment by Johnny Ong — June 28, 2009 @ 1:11 am

    service tax is confirmed at 5% (this is fixed by govt and u have the right to pay 5% only). if they say 10% ask them for a copy of their licence.

    service charge is being charged by restaurants for their own which is usually at 10%

    i have blogged abt this b4 under http://johnny-ong.blogspot.com/2008/08/only-435-restaurants-authorised-to.html

  2. Comment by Vivien — June 28, 2009 @ 4:58 am

    hi Johnny, what do you mean? restaurant charging 10% should have a copy license saying they authorised to charge 10%? and they is another type of license showing they can charge 5%?

    or they default can charge 5% and the additional 5% if what is determine by this Service Tax Act.

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