As GST looms, the people get more confused

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D-Day is just two days away. It is when GST is going to be implemented. Yet, the dust has not settled at all with many still unaware what this new tax is going to do or undo for them.

If one were to go to the shops or the larger supermarkets and ask about GST, most of the salespersons would only giggle and say that they would not know what items would be affected by the new tax and what wouldn’t. Even business people are in the dark over the actual ramifications of GST.

The problem is compounded with the fact that the BN-led government does not want to hear opposition to the implementation of the tax, not even wanting to defer it due the immense confusion that it has caused amongst the people. For premier Najib, GST must begin at all costs 1st April.

Now, the GST in Malaysia has become an issue not so much because there is a new tax but because there is little knowledge about the tax amongst the masses. Saying that this new tax is better than the existing SST (Sales and Service Tax) because SST is at 10% and GST is at 6% does not give the truth to the far reaching effects of the new tax. Everyone knows that SST would only be applicable for certain sectors and where volume and quality of goods/services were of certain standard. That is why SST would normally be charged when one used high end restaurants located in specific places like airports, 5 star hotels and high end resorts. The kampong folk who shop at the local grocery store down the road had not to pay SST of 10% in addition to the listed price of a given item. But now wiith GST, the standard rated items would all be charged the tax. Hence, a tin of Milo bought on 1st April may cost one RM 26.50 when it would have been RM 25.00 the day before, an increase of RM 1.50. If a basket of standard rated goods were to be bought prior to GST day and costed RM 500, on GST day it would become RM 530, an addition of RM 30.

Easily for a household of 5 persons an allocation of RM 200- RM 500 may have to be budgeted just for the new tax. Had this happened in the past when SST was in force? So why is the Umno-led government lying to the people by putting up bill boards everywhere claiming that GST is better than SST? They are not telling the whole truth.

A glaring problem with the GST is its complexity. There are three categories of the tax – Standard Rate (SR), Exempt Rate (ER) and Zero Rate (ZR). Whereas in some other countries there are only two – standard and zero, you are either taxed or there is no tax. Here in Malaysia it has been made to three levels because seemingly they want to accommodate the traders. Actually this in itself shows how fickle-minded the policy makers are.

There is also the input and output tax that further confuse the traders. There are items that are taxed for local consumption but consumers are not taxed if the expenses are meant for some overseas destination, for example air fares – domestic fares are subject to GST, international fares are not.

The initial period is going to create immense confusion and anger amongst the public because when you have traders and businesses themselves not really informed about the tax as to how it would be computed, this would create loopholes for the unscrupulous to manipulate prices at the expense of the rakyat.

So, if you as a consumer intend to buy an item, you would have to go around to several outlets before making a purchase.

Just as 10 different traders have 10 different understandings of the GST – and unfortunately even our political leaders, especially in PAS, have no understanding of this new tax despite being against it – so may you find different prices for a similar item at different outlets.

1st April, GST Day, confusion reigns.

 

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As GST looms, the people get more confused

D-Day is just two days away. It is when GST is going to be implemented. Yet, the dust has not settled at all with many still unaware what this new tax is going to do or undo for them.

If one were to go to the shops or the larger supermarkets and ask about GST, most of the salespersons would only giggle and say that they would not know what items would be affected by the new tax and what wouldn’t. Even business people are in the dark over the actual ramifications of GST.

The problem is compounded with the fact that the BN-led government does not want to hear opposition to the implementation of the tax, not even wanting to defer it due the immense confusion that it has caused amongst the people. For premier Najib, GST must begin at all costs 1st April.

Now, the GST in Malaysia has become an issue not so much because there is a new tax but because there is little knowledge about the tax amongst the masses. Saying that this new tax is better than the existing SST (Sales and Service Tax) because SST is at 10% and GST is at 6% does not give the truth to the far reaching effects of the new tax. Everyone knows that SST would only be applicable for certain sectors and where volume and quality of goods/services were of certain standard. That is why SST would normally be charged when one used high end restaurants located in specific places like airports, 5 star hotels and high end resorts. The kampong folk who shop at the local grocery store down the road had not to pay SST of 10% in addition to the listed price of a given item. But now wiith GST, the standard rated items would all be charged the tax. Hence, a tin of Milo bought on 1st April may cost one RM 26.50 when it would have been RM 25.00 the day before, an increase of RM 1.50. If a basket of standard rated goods were to be bought prior to GST day and costed RM 500, on GST day it would become RM 530, an addition of RM 30.

Easily for a household of 5 persons an allocation of RM 200- RM 500 may have to be budgeted just for the new tax. Had this happened in the past when SST was in force? So why is the Umno-led government lying to the people by putting up bill boards everywhere claiming that GST is better than SST? They are not telling the whole truth.

A glaring problem with the GST is its complexity. There are three categories of the tax – Standard Rate (SR), Exempt Rate (ER) and Zero Rate (ZR). Whereas in some other countries there are only two – standard and zero, you are either taxed or there is no tax. Here in Malaysia it has been made to three levels because seemingly they want to accommodate the traders. Actually this in itself shows how fickle-minded the policy makers are.

There is also the input and output tax that further confuse the traders. There are items that are taxed for local consumption but consumers are not taxed if the expenses are meant for some overseas destination, for example air fares – domestic fares are subject to GST, international fares are not.

The initial period is going to create immense confusion and anger amongst the public because when you have traders and businesses themselves not really informed about the tax as to how it would be computed, this would create loopholes for the unscrupulous to manipulate prices at the expense of the rakyat.

So, if you as a consumer intend to buy an item, you would have to go around to several outlets before making a purchase.

Just as 10 different traders have 10 different understandings of the GST – and unfortunately even our political leaders, especially in PAS, have no understanding of this new tax despite being against it – so may you find different prices for a similar item at different outlets.

1st April, GST Day, confusion reigns.

 

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