Malaysia seeks tax exemption for palm oil raw materials

Kuala Lumpur, August 26, 2025 – Malaysia’s Commodities Ministry is pushing to exempt crude palm kernel oil and palm kernel olein oil from the country’s sales and services tax (SST), the ministry announced on Tuesday. The palm oil industry and oleochemical sector became subject to the SST following its expansion in July, with these raw materials currently facing a 5% tax levy.

Deputy Plantation and Commodities Minister Chan Foong Hin informed Parliament that the application for tax-exempt status for both raw materials has been submitted to the Finance Ministry. He emphasized that the exemption is justified, as crude palm kernel oil and palm kernel olein are raw materials used in producing oleochemical products, not final products subject to government taxation.

Additionally, Chan noted that proposals to provide SST exemptions or relief for certain services critical to the industry’s operations are under consideration. These measures aim to alleviate cost pressures on industry players, enhancing the competitiveness of Malaysian palm oil products in the global market.

Tags: Malaysia, palm oil