Malaysia refreshes bunkering sales-tax exemption procedures

The exemption is existing law

Item 58A covers a person approved to provide bunkering services under the Petroleum Development Act 1974. Goods must be bought from a registered manufacturer or transported from a special area, used solely as bunker fuel and delivered directly to a qualifying vessel. The 2021 amending order established the exemption and its conditions; a 2022 order later updated the tariff-code list from 1 January 2023. Version 2.0 updates the procedure rather than creating a new exemption.^[1][2][3]

Approved fuels and vessels control scope

The guide lists diesel, liquefied natural gas, lubricating oil and greases under specified tariff subheadings, plus very-low-sulphur fuel oil classified as B24. Eligible vessels include Malaysian vessels sailing to foreign ports, foreign vessels on international voyages, international fishing boats, and passenger ferries, cruise ships and tourist boats calling at a foreign port. Other fuels or vessels do not qualify merely because they are used in a bunkering operation.^[1]

Application and reporting controls change

The checklist calls for the customs exemption application, KPDN PDA 2 bunkering approval, a Controlled Supplies Act retail licence and the supplier’s purchase order or pro forma invoice. Applications go to the controlling customs station identified by the operator’s business postcode, and separate applications are required for multiple PDA 2 approvals. Before bunkering, an approved operator must notify the relevant customs division. The operator must complete a report for each operation and retain it for inspection, replacing the previous guide’s monthly submission-by-the-tenth procedure.^[1]

Operators should refresh evidence

Approved operators, fuel suppliers and shipping groups should review application files, licensing evidence, tariff classification, vessel-eligibility checks and per-operation reporting controls. Non-compliance makes sales tax due on the date the condition is breached. The guide is in Malay and states no separate commencement date, so translated procedural details should be confirmed with RMCD before operational reliance.^[1][4]