After much speculation from multiple sources, MCMC has decided to set things straight by issuing their own press statement about the ongoing 6% GST for prepaid reloads. There seems to be a confusion on whether the reloads will go back to pre-GST rates come 1st May, and it was probably due to the announcement made by the Royal Customs and Excise Department director-general Datuk Seri Khazali Ahmad.
MCMC’s Chairman, Dato’ Sri Dr Halim Shafie, has announced that the prepaid reloads will continue to be sold with the GST added to the reload amount and that the current practice will proceed even after the coming Labour Day this Friday. He gave two reasons as to why the change will not happen. Firstly, it seems that the communications providers are still conducting a survey to determine the preferred mechanics of levying the tax to the top-up denominations: either the current method of adding the GST onto the reload value (RM 10 reload value + 60 sen GST = RM 10.60), or to have the GST factored-in to the usual top-up denominations (RM 9.43 + GST = RM 10). Secondly, the May 1 date is much too close for the service providers to roll-out any changes, if indeed the survey results have been collected already.
The cost and complexity of reverting back to the pre-GST arrangements will be significant as it involves reconfigurations of the systems. It will not only involve service providers but also third party agents such as financial institutions, electronic payment providers, supermarkets, petrol stations as well as other sales agents. The service providers will also need to produce new stocks for the reload cards and these will again need to be distributed nationwide.
However, Dr Halim did add that the survey is almost complete and that the results will be presented to the relevant authorities next week. The customs department had also agreed to wait for the results before making any decisions. MCMC will only be able to make further considerations after looking into the survey results, as well as the technical and financial implications of the methods proposed.
For now, MCMC has confirmed that the current method of adding the GST to the reload amount will stay.
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