Expanded SST: Is Banking Services Affected? What will be Taxed?

Malaysia’s 8% Service Tax (SST) on financial services is set to begin 1 July 2025, but rest assured — your routine banking isn’t affected, says a joint statement from the Association of Banks in Malaysia (ABM), Association of Islamic Banking and Financial Institutions Malaysia (AIBIM), and Malaysian Investment Banking Association (MIBA).

Is Everyday Banking Affected?

Short answer: No

Basic, day-to-day banking services — like savings and current account transactions — are explicitly exempt from the 8% SST. ABM affirms that no new tax will apply to core services used by individuals and households.

Which services remain TAX-FREE?

The following everyday banking services will continue to be without SST:

• Withdrawals & deposits (branch or ATM)
• Mobile/Internet banking transfers (IBG, DuitNow)
• Bill payments and standing instructions
• Savings and current account fees
• Islamic equivalents of these services

Then, what will be Taxed?

The 8% service tax will apply to fee‑ and commission‑based financial services, including 😬:

• Cross-border remittances
• Wealth advisory and investment management services
• Safe deposit box rentals
• Trade financing fees
• Other non-routine banking charges

Quick Recap

Your everyday banking stays SST-free, even as financial services expand its tax reach. Just remember, any fee-based or commission-based service — like remittance or wealth management — will carry the 8% SST.

Keep an eye out for official notices from your banks starting July 2025 to know exactly which fees will be affected.

For more info, check with your bank...

Source: Maybank

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