Effective July 1, 2025, the measures include a one-year exemption for non-reviewable contracts, separation of taxable service and non-taxable material components in mixed contracts, and exemption for residential portions in mixed developments.
The Master Builders Association Malaysia said the construction sector is already burdened by multiple layers of taxation on materials, labour, and equipment, with most contracts awarded on a fixed-price and fixed-duration basis.
“This translates to an additional financial burden of an estimated not less than RM110 million per month for the construction industry.
MBAM president Oliver Wee Hiang Chyn: “The construction industry is in for a bumpy ride if we still refuse to embrace the disruption of technology and advocate for [sustainability].
The elected deputy president was Kenneth Liew Kiam Woon of LFE Engineering Sdn Bhd.
This is in response to the government's implementation of an increase in service tax to 8% from 6%, and its scope expanding to cover logistics services, which will be taxed 6% come April 1 this year.
“In order to pump prime the revival of the Malaysian construction industry, the MBAM appeals to the government to provide more assistance for the construction industry to revive and sustain the construction sector.
Works Minister Datuk Sri Alexander Nanta Linggi: Embracing these trends and technologies will not only lead to more efficient and cost-effective construction processes, but also contribute to a more environmentally responsible and resilient built environment.
En added that on adjudication alone, fees worth hundreds of millions have been paid by disputing parties since its inception and this does not include legal expenses incurred at various courts and arbitration.
“The MRT project is currently already at an advanced stage and should be implemented soonest.
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