Prepaid Reload: Are We Paying For GST Or Not?

mobile reload

The 6% GST charged on prepaid reload cards had mobile prepaid users in furore for the past one and half weeks.

Though it has not been finalised yet, the prices of prepaid reload cards could revert to their original prices, prior to GST by next month.

According to Datuk Subromaniam Tholasy, the GST director of the Customs Department, the matter was still being finalised with the country’s telecommunication companies, but adding that the Government was “hopeful”.

“The Deputy Finance Minister II (Datuk Ahmad Maslan) has chaired a meeting with the telco chiefs and discussed reverting to the old prices for prepaid top-up cards.

“We have expressed our stance to the telcos.

“However, they asked for a month to adjust the prices because the process is not that simple and it takes time.

“Next week, the Customs director-general will meet the telco chiefs again for further discussion,” Subromaniam said at a joint press conference with the Domestic Trade, Cooperatives and Consumerism Ministry officials here yesterday.

Prior to GST, telcos had been absorbing the Sales and Services Tax (SST) of 6%, which was replaced by the GST.

However, after April 1, telcos went on to charge the GST on top of the reload card prices, making a RM10 reload increased to RM10.60.

After a meeting between government officials and telcos, it was decided that the companies would be allowed to temporarily impose the GST on top of the prices – with additional talk time for customers – until a new solution was found.

“For the time being, consumers will have to pay the extra 6%.

“But they will get additional talk time.

“Whatever decision we come to, I can assure consumers that they will not lose out either way,” said Subromaniam.

According to Subromaniam, the Customs Department has collected RM259mil in GST revenue since April 1 from imported goods.

However, not all of the amount will go into the Government’s coffers as importers are expected to file for input tax claims.

“As for the GST collected from the purchases of goods or payment for service, this will only be declared at the end of every month,” Subromaniam said.


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