KUALA LUMPUR: Income generated from cryptocurrency activities including trading, mining, and exchange operations falls under Malaysia’s Income Tax Act 1967.
The Finance Ministry confirmed that digital currencies are treated as commodities, making related earnings taxable as business income.
This approach aligns with global tax standards and follows guidelines issued by the Inland Revenue Board.
Local digital service providers must also pay service tax under the Service Tax Regulations 2018.
Foreign digital service providers have been subject to service tax for business-to-consumer transactions in Malaysia since January 1, 2020.
“This measure aims to broaden the tax base and ensure equal tax treatment between local and foreign service providers.”
Cryptocurrency trading platform services from both local and international providers are subject to service tax based on specified conditions.
The ministry provided these details in response to a parliamentary question from Lim Guan Eng regarding tax payments by LUNO Malaysia.
LUNO Malaysia, registered in 2015 and approved by the Securities Commission in 2019, offers cryptocurrency trading and storage services.
The platform provides access to major cryptocurrencies including Bitcoin and Ethereum alongside Shariah-compliant products.
Corporate income tax is calculated on taxable income after deducting allowable expenses and applying relevant tax treatments.
“The amount of income tax paid by any company or taxpayer is also classified information.”
Tax confidentiality is protected under Section 138 of the Income Tax Act 1967, consistent with international practices. – Bernama
