🏗️ Malaysia’s 6% SST Expansion to Construction Services: What It Means for Homebuyers

June 2025 – Kuala Lumpur – The Malaysian government is set to broaden its 6% Sales and Service Tax (SST) to encompass construction services starting July 1, 2025. The tax will be imposed on contracts in the infrastructure, commercial, and industrial sectors with annual taxable value exceeding RM 1.5 million, though residential building works remain exempt, including public housing and related utilities edgeprop.my+7theedgemalaysia.com+7findhouse.com.my+7.

⚠️ Industry Warnings: A Ripple Effect on Home Prices

REHDA, representing developers, warns the move could drive up home prices and chill the property market, as contractors already subject to indirect taxes will now face a direct 6% SST burden scoop.my+6theedgemalaysia.com+6dailyexpress.com.my+6.
REHDA President Datuk Ho Hon Sang states that increased costs may be transferred to buyers, especially in mixed-use developments with serviced apartments or strata shops, and calls for a grace period until 2026 to avoid disrupting projects under negotiation klpropertytalk.com+3edgeprop.my+3dailyexpress.com.my+3.
The Master Builders Association Malaysia (MBAM) and Federation of Malaysian Manufacturers (FMM) have also urged a review or delay, citing undue pressure on contractors and potential disruptions to ongoing developments theedgemalaysia.com+1scoop.my+1.

📊 Perspectives from Analysts

Analysts highlight that only contracts above RM 1.5 million are affected, and with residential projects exempted, impact is expected to be controlled theedgemalaysia.com+3businesstoday.com.my+3moomoo.com+3.
RHB Research says although SST may compress margins, resilient demand—especially in industrial property—can sustain the sector. They also note another 8% tax on leasing income exceeding RM 500,000 annually, which may ultimately be passed to tenants news.futunn.com.
Economists from Xinhua and Maybank suggest a modest inflationary boost (up to 0.25 percentage points) but expect limited broader market impact due to existing exemptions english.news.cn.

📌 Summary Table

Issue	Details
Effective date	July 1, 2025
Tax rate	6% SST on contract value > RM 1.5 million
Exemptions	Residential building and related public utilities
Industry reaction	REHDA, MBAM, FMM raise concerns and seek delay
Analyst insight	Cost pass-through likely; residential largely shielded
Inflation impact	Moderate, up to +0.25 pp

🏡 Why You Should Consider Buying Now

This tax directive signals rising construction costs ahead, meaning soon-to-launch projects in this window may lock in lower prices—afterward, cost increases are likely passed on. For investors and homebuyers, timing is crucial.

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Urgent factors:

Land around CIQ is nearly exhausted.
RTS integration may boost price and demand.
Nearby monthly parking rents exceed RM 500—Brixton includes yours free.
First phase inventory is limited and selling fast.

✅ Action Steps

To lock in current pricing before SST-driven cost adjustments:

Book a project walkthrough or showroom visit.
Download full floor plans and pricing materials.
Ask about financing options and rain protection from pending SST changes.

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https://wa.me/60125437759

Jun 15,2025