18 July – With sales and services tax (SST) slated for implementation on Sept 1 following the removal of the goods and services tax (GST), consumers can’t wait to find out whether the prices of goods and services would go up or down next.
Despite projected lower operating costs and improved cash flow with SST compared with GST, the reduction in cost would be too little to have a downward pressure on most consumer items.
On the other hand, the prices of certain items such as vehicles, electronic goods, and home appliances could go up under SST compared with GST.
On top of that, consumers are also worried that the government might widen the SST net, Sin Chew Daily reported today.
SME Association of Malaysia president Datuk Michael Kang said if details of the SST structure show that the cost is going to go up for small and medium enterprises (SMEs), they will surely pass the additional cost to the consumer.
He said what SMEs fear now is that the government might broaden the SST net as Finance Ministry statistics showed that prior to its abolition, GST could boost the federal coffers by RM42 billion a year and government hopes to maintain this figure with SST, hinting that the SST net would have to be broadened to increase collection.
Tax expert Koong Lin Loong said he expects the government to raise the SST threshold , which was an annual turnover of RM100,000 before it was replaced with GST, to be raised to RM500,000 to match that of GST.
He believed that although the Pakatan Harapan government is bringing back the same tax rates – 10% for sales and 6% for services – that were used before GST, there will be some changes in its SST structure to suit the current situation and to also be fair to businesses.
– The Sun