SST and Customs Duty on Imported Food (Malaysia)

The tax burden on food imported into Malaysia has two core layers: customs duty (Customs / Import Duty) and sales tax (the goods side of SST). Customs duty is determined by the goods' HS Code (Harmonized System tariff), with rates ranging from 0% to quite high; sales tax is the SST system restarted in September 2018, with a standard rate of 10%, some items at 5%, and many staple foods listed as exempt. In practice, how much an imported food actually pays depends on "its HS classification + the exemption orders in force," and cannot be generalized.

How the two layers of tax are composed

In other words, sales tax is usually calculated on top of "CIF + customs duty," not just on the goods value.

Customs duty: it all starts with the HS Code

The first step of import duty is always to classify the HS Code correctly. Wrong classification leads to a wrong rate calculation, or even triggers control/permit requirements. Malaysia uses the ASEAN AHTN tariff, and the rate range is very wide (some foods 0%, some processed/protected items higher). For the specific rate of a given food, please rely on the RMCD Customs Duties Order in force and the tariff lookup; this article does not list figures item by item to avoid becoming outdated.

Sales tax (SST): 10%, 5% or exempt?

• Standard rate 10%: Most taxable goods.
• 5% reduced: Some items.
• Exempt: Many staple foods are on the exemption list. According to public compilations, commonly exempt food categories include staples and fresh produce, such as rice, chicken, beef, vegetables and eggs, as well as some local fish species (such as selar, tongkol, cencaru, sardines, etc.).
• Exemptions and rates are subject to the gazettes in force such as the Sales Tax (Goods Exempted from Tax) Order 2018 and the (Persons Exempted) Order, which are amended from time to time.

Reminder: SST underwent several scope and rate reviews during 2024–2025; be sure to check the current announcement on whether new items have been included or adjusted.

Customs declaration and tax calculation points

1. Confirm the HS Code: Determines the customs duty rate and whether an AP/permit is needed.
2. Calculate the tax base: CIF (cost + insurance + freight) → add customs duty → use as the SST tax base.
3. Determine exemption: Cross-check against the exemption orders in force to confirm whether the food is exempt or reduced.
4. Customs declaration (K1): Declare and pay tax through the RMCD system.
5. Retain documents: Invoices, bills of lading, certificates of origin, permits, etc. for inspection.

Imported vs local: different tax points

Imported food is taxed by RMCD at the moment of clearance, on a base of CIF + customs duty; locally manufactured food is charged sales tax by the licensed manufacturer at the point of factory sale. For the same food item, the tax base, timing and cash flow all differ between imported and local, so calculate them separately when building a cost model.

Common mistakes

• Wrong HS Code classification → wrong rate calculation or missing permit requirements.
• Assuming all foods are tax-exempt: only those on the exemption order are exempt; processed/packaged foods are often still taxable.
• Calculating SST on the goods value only, missing "add customs duty first, then tax."
• Reusing old rates/old exemption lists without checking the current gazette.

Frequently asked questions (FAQ)

Q: What is the SST on imported food? The standard goods-side sales tax is 10%, with some items at 5% and many staple foods exempt; the actual figure depends on the food's classification and the exemption orders in force.

Q: Is SST charged on the goods value or on the value after customs duty? Sales tax is usually calculated on a base of "CIF + import duty," not just on CIF.

Q: Which foods may be exempt? Staples such as rice, chicken, beef, vegetables and eggs and some local fish species are commonly on the exemption list; you must verify against the current Sales Tax (Exemption) Order.

Q: How do I check the customs duty rate? First determine the goods' HS Code, then cross-check against the RMCD Customs Duties Order in force for the corresponding rate; different foods vary greatly.

Q: Do the rates change? Yes. The SST scope and rates have been reviewed several times in recent years, and customs duties are also adjusted by order, so be sure to rely on the announcement in force at the time of customs clearance.

Self-check list

• [ ] Confirmed the correct HS Code for each food item
• [ ] Obtained the customs duty rate against the current Customs Duties Order
• [ ] Estimated SST on a base of "CIF + customs duty" (10%/5%/exempt)
• [ ] Checked the current exemption order to confirm whether exempt
• [ ] Prepared invoices, bills of lading, certificates of origin and other customs documents

Summary

Imported food tax = customs duty (based on HS Code) + sales tax (10%/5% or exempt), and SST is stacked on the base that includes customs duty. Rates and exemptions change, so don't use old tables — classify the HS Code first, then check the order in force.

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This article is compiled from official sources and is for reference only; actual compliance is subject to the latest official text and review by the competent authorities.