The Royal Malaysian Customs Department (RMCD) has issued Public Ruling No. 1/2026, effective 31 March 2026, to standardise how foreign currency transactions are converted into Malaysian Ringgit (MYR) for Sales Tax and Service Tax (SST) purposes. This ruling replaces previous informal practices with clear rules on exchange rate sources, timing, consistency, and invoice requirements, signalling a move towards stricter compliance and audit readiness.
Public Ruling No. 1/2026 introduces six distinct compliance areas that businesses must address. Each carries specific operational and audit implications.
F. Approval for Alternative Sources: Any deviation from approved exchange rate sources requires prior written approval from RMCD. Businesses should not assume flexibility without formal authorisation.
What Malaysian Companies Should Do Now
To ensure compliance with Public Ruling No. 1/2026, companies should act immediately across five key areas.
Key Recap
Key Takeaway
Public Ruling 1/2026 tightens SST compliance, especially for foreign currency transactions. Companies must align exchange rate policies, invoicing, and controls to reduce risk and stay compliant in a more audit-focused environment. Act now — the effective date is 31 March 2026.
