The Malaysian government’s move to exempt Sales and Service Tax (SST) on animal feed is a timely measure to help reduce rising operating expenses in the sector, reported the Star online. SST on feed ingredients is 5%.
Effective January 1, the exemption covers raw materials used to produce animal feed, fertilisers and pesticides. The move is part of the Finance Ministry’s updated SST policy, which aims to control the prices of essential goods.
The Marine Fish Farmer Association Malaysia said the SST exemption on feed provides much-needed relief, as feed represents a major portion of the production costs.
“The exemption is significant for us, as feed accounts for 40 to 70% of operating costs, depending on the species and cultivation methods. It will cushion other input cost increases such as energy, wages and logistics,” it said. The association expects local feed mills to reduce prices in February or March, adding that the strong ringgit has also made imported feed ingredients more competitive.
“Overall, the exemption benefits farmers, but the extent depends on whether feed millers pass the savings down to them.”
Pahang Deep Sea Association chairman Mohd Yusery Mohd Yusoff also praised the measure, highlighting its impact on aquaculture operators. He added that shrimp prices for size 25/kg dropped from over RM30 to about RM28, which he attributed partly to easing feed cost pressures.
In September 2025, the Ministry of Finance had announced an exemption from Sales Tax or subject to a zero rate for raw soybeans which are a key component in animal feed production. This measure was to stabilise the prices of essential food items such as chicken, eggs and meat. According to the MOF’s appendix, zero-rated animal feed refers to types suitable for poultry, pigs, prawns, and other livestock not included in the list.
The Edge reported that the Association of Commodities Importers for Animal Feed Malaysia (ACiAFM)’s interim president Chong Kam Weng noted that 30% of raw materials used to produce animal feed, including soybeans, wheat pollard, canola meal and vitamin premixes, are subjected to a 5% SST. ACiAFM did acknowledge that 70% of feed inputs, such as corn, soybean meal, palm oil and palm kernel cake, have already been exempted from SST.
