The Ministry of Finance (MoF) has been slaving away tinkering and adjusting the scale of the annual Budget announcement. Being hard hit by drops in oil trade prices due to an excess of supply and micromanaging the qualms of 1MDB, our Prime Minister Datuk Seri Najib Tun Razak has a lot on his hands – if that wasn’t clear enough. But will the ICT market win or lose when Budget 2016 is read?
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When GST came into effect on 1st April, Malaysian consumers were up in arms over the extra 6% charge on prepaid reloads. There was mass confusion as Deputy Finance Minister Ahmad Maslan retorted that there shouldn’t be any price increase. The fact is prepaid services should have been taxed with service charge which the telcos have been absorbing all these while. There’s no running away from GST as even postpaid users have always been paying the extra 6% tax on their monthly bills.
After taking charge of the prepaid reload issue, Communications and Multimedia Minister, Datuk Seri Ahmad Shabery Cheek has finally announced a solution which would hopefully put the matter to rest.
The implementation of GST in Malaysia has caused a stir for prepaid users as there was confusion on the extra 6% tax on top ups/reloads. To make things clear, 6% GST will be applied to all telco services whether it is postpaid or prepaid with the exception of international roaming charges. So if you’re buying a RM10 top up, you have to pay RM10.60 and a RM50 top up would cost you RM53. There’s no running away from it at the moment.
As consumers were caught unaware of the new charges, things got more confusing when Deputy Finance Minister Datuk Haji Ahmad Maslan declared that there shouldn’t be any price increase of prepaid reloads. You can probably imagine the chaos at phone shops and convenience stores nationwide. Even some shops were reported to stop selling prepaid reloads as they had gotten fed up with justifying the added charges.