"MANUFACTURE"

The meaning of "manufacture" is defined in Section 3 of the Sales Tax Act 2018:

Meaning of “manufacture”

3.       (1)     In this Act, “manufacture” means —

(a) in relation to goods other than petroleum, the conversion by manual or mechanical means of organic or inorganic materials into a new product by changing the size, shape, composition, nature or quality of such materials and includes the assembly of parts into a piece of machinery or other products, but does not include the installation of machinery or equipment for the purpose of construction; and

(b) in relation to petroleum, any process of separation, purification, refining, conversion and blending.

(2)     If any question arises as to the meaning of “manufacture” under subsection (1), such question shall be decided by the Minister whose decision shall be final.

A problem arises where there is no significant change in certain cases or situation where the process involves a simple cutting or drilling holes or polishing otherwise the processed product remains the same.Although outwardly the product has not undergone significant change, its quality has been enhanced. In some cases the cut or drilling of holes is a preliminary process in the manufacture of another product and it qualifies as "manufacture". Here are some decisions on such processes: