Hottest Online News Portal

GST Not An Excuse Not To Lower Car Prices

in Top News

KUALA LUMPUR – The implementation of the goods and services tax (GST) is not an excuse for automotive industry players not to lower car prices, Deputy Finance Minister Datuk Ahmad Maslan said.

He said car prices should drop as the current 10 per cent sales tax imposed would be replaced by a six per cent GST.

“It’s a simple calculation to understand, and automotive industry players should not find an excuse not to lower car prices by blaming it on the GST,” he told Bernama here.

On an argument that car prices will not necessarily come down as the GST will be imposed at every level of production and distribution chain, he said the tax imposed could be claimed unlike the sales and service tax (SST).

The GST at six per cent will replace existing sales tax (10 per cent) and service tax (six per cent) from April 1, 2015.

Finance Ministry and International Trade and Industry Ministry officials have asserted that car prices on average might be slashed by between one and three after the GST is implemented.

Ahmad said the government had formulated policies to drive prices of certain goods down, so the prices of these items should be lowered.

“Indeed, we expect car prices to fall, but we are not certain of the rate,” he said.

He said the prices of 532 out of 944 items exempted from the GST would drop based on the calculation of the multi-layered SST levied on them.

“The existing SST has resulted in the prices of goods to increase by between 15 and 18 per cent from the 10 per cent originally imposed,” he said, adding that for processed food, the prices increased by eight per cent from the five per cent tax levied.

Yesterday, the government announced a list of more than 900 items that will be zero-rated and exempted from the GST. – BERNAMA

Tags:

Latest from Top News

Go to Top