KUALA LUMPUR — The Finance Ministry (MOF) has clarified that refined sugar remains exempt from the revised Sales and Service Tax (SST) taking effect on July 1, 2025, and there is no reason for any price increase.

While raw sugar used in refining will be taxed at 5%, manufacturers like MSM Malaysia Holdings Bhd can apply for tax exemptions on raw materials. The MOF added that sugar refiners continue to receive monthly government incentives to maintain stable prices and supply.

The ministry was responding to MSM’s recent remarks on the SST’s potential impact. It stressed that essential goods—including sugar, rice, oil, meat, and vegetables—remain untaxed under the Madani Government’s targeted approach to shield consumers from inflation.

MSM had earlier stated that raw sugar accounts for up to 80% of its production costs and warned of possible cost pressure, though it acknowledged retail sugar prices are controlled at RM2.85 per kg.