This alert provides a summary of the extension of GST to B2C imported non-digital services and low-value goods imported via air or post.
GST was imposed on business-to-business (B2B) and business-to-consumer (B2C) imported services by way of Reverse Charge (RC) and the Overseas Vendor Registration (OVR) regimes with effect from 1 January 2020.
Currently, B2C imported non-digital services (such as distance learning classes, legal and consultancy services, online counselling and telemedicine services) are not subject to GST. In addition, goods imported via air or post are not subject to GST if the goods are valued at $400 or less.
In Budget 2021, the Minister for Finance announced that the following will also be subject to GST with effect from 1 January 2023:
- B2C imported non-digital services through the OVR regime.
- Low-value goods imported via air or post through the extension of the OVR and RC regimes.
On 10 December 2021, the Goods and Services Tax (Amendment No. 34 of 2021) Act 2021 was published in the Government Gazette by the Ministry of Finance to effect the above changes.
