Taobao, the Chinese online shopping platform, has initiated the enforcement of a 10% sales tax on purchases made by users residing in Malaysia, as mandated by the Malaysian government.

Effective from January 1, 2024, Malaysia introduced a 10% sales tax on imported low-value goods (LVG) valued at RM500 and below.

This policy directly impacts Taobao users in Malaysia since the platform exclusively offers items from China. Despite Taobao not officially announcing the implementation of the sales tax, Malaysian users have started receiving notifications on the Taobao app regarding the 10% sales tax. The LVG sales tax is also displayed during the payment process for purchases under RM500.

This policy directly impacts Taobao users in Malaysia since the platform exclusively offers items from China. Despite Taobao not officially announcing the implementation of the sales tax, Malaysian users have started receiving notifications on the Taobao app regarding the 10% sales tax. The LVG sales tax is also displayed during the payment process for purchases under RM500.

One such notification received by Malaysian users on the Taobao app stated, "Taobao imports low-value goods according to Malaysia (“Imported Low-Value Goods” or “LVG”) requires that the relevant sales tax calculation, calculation and payment responsibilities be fulfilled from the effective date. The relevant regulations came into effect on 1 January 2024."

Moreover, the Taobao app now includes a dedicated section at the bottom of the payment page listing the applicable sales tax amount for purchases.

It's worth noting that in addition to the 10% sales tax, Taobao also imposes a 3% fee for users who opt to use an international card (as opposed to a Chinese card) for payment. When combined with any exchange fees from Malaysian Ringgit (MYR) to Chinese Yuan (CNY), these additional charges significantly augment the original price of items purchased on Taobao.