Consumers' awareness, perceptions and behaviour towards the imposition of sales tax on imported low value goods

The emergence of digitalisation has opened another opportunity for the Government to generate revenue from those activities for the benefit of the nation. The proposed sales tax on the imported low value goods (LVGs) sold in the online marketplace has attracted various responses from the public. The flat rate of 10% sales tax will be implemented starting 1 April 2023 on goods that are priced below RM500 which have been brought into Malaysia by using land, sea or air modes. This study has been conducted to examine the consumers’ awareness and perception towards the proposed tax and their relationship with the behaviour of the consumers prior to the implementation of the tax. Quantitative research design has been adopted by distributing questionnaires to the respondents where simple random sampling has been performed in selecting the respondents. One hundred and sixty-two responses were gathered from the distribution of questionnaires using Google form link. The statistical analysis shows that the respondents have moderate level of awareness and perceptions towards the newly proposed tax. However, the respondents have unfavourable behaviour towards the proposed tax. Further, it is found that there is a significant relationship between both consumers’ awareness and consumers’ perceptions with consumers’ behaviour towards the imposition of sales tax on imported LVGs. The results of this study provide insights on the awareness, perceptions and behaviour of the consumers towards the proposed tax by the Government. It may be taken as indication especially to the Royal Malaysian Custom Department on the mechanisms and effective initiatives to implement and ensure generation of tax revenue via the imposition of sales tax on imported LVGs.