Money & tax

What is SST (Sales and Service Tax)?

Also called Service tax Malaysia

SST is Malaysia's Sales and Service Tax. For food and beverage preparation the service tax rate is 6% — F&B falls under Group B, which was explicitly excluded when the general service tax rose to 8% in March 2024.

This exclusion is widely misreported. A Malaysian restaurant charging 8% service tax on food and drink is over-collecting, and a POS configured with the general rate will produce wrong bills at every transaction.

Service tax only applies once a business is registered, which depends on rolling 12-month taxable turnover against the Group B threshold. Smaller outlets below it do not charge it at all.

Example

A 100 bill with a 10% service charge is 110, and 6% service tax on that is 6.60 — a total of 116.60.

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