After a month debating the mobile prepaid Goods and Services Tax (GST) fiasco, Communication and Multimedia Minister Datuk Seri Ahmad Shabery Chik announced that prepaid mobile users will now get RM10 worth of air time for RM10 top-up.
However, GST will still be charged for calls, text messages and data upon usage, instead of the current RM10.60 charge (inclusive of 6% GST) for a RM10 top-up.
This new system will be implemented from 2016 to give telcos time to prepare ahead.
Communication and Multimedia Minister Datuk Seri Ahmad Shabery Chik, who disclosed this at a press conference yesterday, said the Government decided that the new method of incorporating GST on prepaid usage was suitable and fair.
“The GST is collected only when consumers use the service and not before.
“This, however, could not be done now because the GST-included prepaid cards are still in the market,” he said.
Telco operators have been informed of this decision, and they needed about six months to reconfigure their systems and produce new cards.
The reconfiguration, he added, was a difficult process which involved many distribution strata and agents as well as various inputs for the prepaid top-up values such as the physical card, online added value, the Internet and mobile banking, and the automated teller machine.
“To balance the effects of the GST, the Government has asked the telco operators to reduce the rates of their services and offer more affordable packages to targeted groups such as students,” he said.
Prepaid mobile phone users are not particularly thrilled with the decision as they will still be charged GST.