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Sales Tax Act 2018: Amendment of Sch – Sections 2 & 35: Imposition of Sales Tax on Low-Value Goods

Updated: Dec 9, 2023

The Sales Tax Act 2018 [Act 806] has undergone amendments through the Sales Tax (Amendment) Act 2022, specifically introducing a new part called "Part IIIA - Imposition of Sales Tax on Low-Value Goods."

This part outlines that the provisions of the Sales Tax Act will apply to low-value goods, with certain exceptions and modifications as outlined in the Schedule.

The proposed amendments in the Finance (No. 2) Bill 2023 focus on modifying the Sales Tax Act 2018 schedule.

Firstly, in relation to section 25, the change involves extending the timeframe for compliance.

Specifically, the words "following month" are substituted with "following two months" in subsection (1).

Secondly, in relation to section 35, the amendments propose substitutions in the wording to align with the taxation of low-value goods.

The words "taxable goods manufactured or imported" are substituted with "sale of low-value goods," and the words "taxable goods" are replaced with "low-value goods."

The tax impact of these amendments is significant, as they introduce a distinct framework for the imposition of sales tax on low-value goods.

By exempting certain sections and parts (Parts VIII, IX, IXa and XIII, and sections 3, 14, 15, 16, 23, 32, 35, 36, 37, 40, 41A, 43, 44, 45, 46, 47, 57A, 76, and 96) from applying to low-value goods, the legislative changes aim to provide a tailored and efficient regulatory environment for the taxation of this specific category of goods.

The adjustments in wording under section 35 further ensure clarity and accuracy in describing the taxable elements related to low-value goods.

Overall, these amendments reflect a targeted approach to sales tax, particularly concerning low-value goods, streamlining processes and compliance requirements for businesses involved in selling such goods.

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