Scrap Metal Export Tax Revised to 10%

SEATTLE (Scrap Monster): The state of Sabah has revised sales tax on scrap metals exported out of the state, said Phoong Jin Zhe, Minister of Industrial Development and Entrepreneurship.

Following the lifting of ban on scrap iron exports in February last year, the state had imposed a state sales tax of RM200 per metric tonne for exports out of the state, which amounted to approximately 13% of the prevailing market price for scrap export. The decision to revise downwards the tax comes after strong protests from scrap metal dealers.

For instance, the Sabah Scrap Metals Recycle Association (SSMRA) had raised strong opposition to the tax, saying that it was highly burdensome. Any fall in scrap metal prices in international market could severely impact them, as they will have to pay the same tax then also.

Phoong Jin Zhe noted that the revision of sales tax to 10% would benefit both sides. He reminded that developing countries such as China and India too are seen adopting such practices.

As part of streamlining the trade, it has decided to use the LME and bar chart as reference platform to control scrap metal export prices. In addition, all scrap metal dealers with weighing scales are required to apply for a state government approval license (SGA) to continue operations.