Or Are We Just Misunderstanding It?**
When Malaysians first heard about LVG, social media exploded.
“LVG tax 10% is killing the rakyat!”
“Why tax cheap goods?”
“Since when LV, LVG, LV… I don’t even own LV bags!”
Let’s clear this up once and for all — LVG is NOT a luxury bag brand.
LVG stands for Low Value Goods.
And no, this tax didn’t suddenly appear overnight.
LVG Isn’t New — It Was Approved Years Ago
Here’s the truth many people don’t know:
The LVG tax was approved by the previous government, not the current one.
What changed was the timing of implementation.
Just like GST, any new tax system needs a grace period so businesses can prepare.
That’s why LVG was postponed from 2023 to 2024 — to give sellers, platforms, and customs time to adapt.
Especially for registered sellers, who must:
Register officially
Declare goods properly
Follow new compliance rules
This isn’t a rushed decision. It’s a delayed one.
So What Exactly Is LVG?
LVG applies to imported goods valued under RM500.
Previously:
Goods below RM500 enjoyed de minimis exemption
No import duty, no sales tax
Made sense when imports were bulk shipments
But today?
📦 We buy one unit directly from China
📱 Through Shopee, TikTok Shop, Temu
🚚 Delivered straight to our doorstep
The market has changed — the tax system didn’t.
The Real Problem: Local Businesses Are Losing
Here’s the uncomfortable truth.
Local manufacturers:
Pay sales tax (5–10%)
Pay compliance costs
Follow Malaysian regulations
Imported low-value goods?
Zero tax
Zero duty
Cheaper by default
Result?
👉 Foreign goods become cheaper
👉 Local products lose competitiveness
👉 Local industries slowly die
That’s exactly why Indonesia shut down TikTok Shop completely.
Malaysia chose a less radical approach — LVG tax.
Why 10%? Why Not Higher or Lower?
Simple.
10% matches Malaysia’s Sales Tax rate.
Not 15%.
Not 8%.
Not punishment.
The goal is to create a fair playing field.
LVG tax:
Applies mainly to large foreign sellers
Small sellers below certain thresholds are exempt
Encourages local market growth
This isn’t about “squeezing rakyat”.
It’s about economic balance.
Why People Are Still Angry
Because:
The term “tax” triggers emotion
LVG sounds confusing
Misinformation spreads faster than facts
Even I was influenced at first — until I looked deeper.
The economy today is borderless, digital, liberalised.
Our tax system must evolve, or we lose control completely.
So What Can YOU Do as an Individual?
You can’t control taxes.
But you can control how you manage your money in uncertain times.
That’s where smart, ethical investing matters.
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Taxes may rise. Prices may change.
But financial literacy is still your strongest weapon.
📌 Share this if you think LVG deserves a fair explanation — not just viral outrage.
