Here’s all you need to know about Prepaid and GST for 2016


Beginning 1st January 2016, all prepaid reloads in Malaysia will be sold without the extra 6% charge. This is in line with the directive to exempt prepaid reloads from GST. It doesn’t mean that prepaid is free from GST, as it will be charged upon usage, instead of being paid upfront.

Fortunately, the government will be offering GST rebates as announced during Budget 2016. To address concerns, MCMC has published the full details ahead of its implementation on new year’s day

Top Up Value

Beginning 1st January, a RM10 prepaid reload will be sold at RM10, while a RM30 prepaid reload is sold at RM30 just like the old days. So you’re getting a full ringgit to ringgit value without the extra 6% charge. The official FAQ also states that old top up tickets must be sold at the original price without the extra 6% charge. At the moment, several prepaid brands are offering extra bonus and rewards if you top up by 31st December.

However with the new mechanism, the GST charge will kick in when you reload. So after activation of a RM10 top up, you’ll get RM9.43 airtime with RM0.57 (6%) being deducted for GST. To the regular consumer, it appears to have no difference since eventually you’re getting 6% less versus paying 6% more. This will be running from 1st January until 31st December 2016 and there’s no mention if it will be extended to the following year.

GST Rebate

The good news, of course, there’s a full GST rebate on prepaid usage. This will be applicable only to Malaysian citizens based on the NRIC or police/army identification number during registration. According to MCMC, the 6% GST will be refunded within 24 hours. So if you’ve topped up RM10, you should be getting the earlier deducted RM0.57 back to your prepaid account. In a nutshell, Malaysians should be able to enjoy the full reload amount but provided that you’re registered. You are advised to check with your telco provider to ensure they have your correct details.

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The GST rebate is only for prepaid users, so Malaysian postpaid users will still continue to incur the 6% charge in their monthly bills.

What services are subjected to GST?

All domestic use including phone calls, SMS, mobile services and data are GST chargeable. International roaming including data usage overseas are zero rated and non-Malaysian prepaid users are also eligible for a refund.

For more information, you can read up the full FAQ here.

[ SOURCE 2 ]

Alexander Wong