SHAH ALAM: Tea traders expects slight increase in cost as the incoming Sales and Services Tax would be imposed on print and packaging materials.
“As of now, we know that imported tea is not subjected to Goods and Services Tax (GST) or Sales and Services Tax (SST). But when it comes to print and packaging materials, our members would most probably have to pay SST,” said Tea Trade Association of Malaysia deputy chairman Lee Ken Eng.
“We’re also not sure if the print and packaging materials are going to be taxed 5 or 10 per cent as we are waiting clarification from Customs,” Lee told the New Straits Times at the sidelines of media preview of the Selangor International Business Summit 2018.
Currently, the Sales Tax Bill 2018, Service Tax Bill 2018, Goods and Services Tax (Repeal) Bill 2018, Customs (Amendment) Bill 2018 and Free Zones (Amendment) Bill 2018 are being tabled in the Dewan Negara, after Members of Parliament in the Dewan Rakyat have passed them.
These set of new laws are to abolish the GST and replace it with the SST, which will come into force from 1st September 2018.
Finance Minister Lim Guan Eng had reportedly said the number of goods and services that will be exempted from SST was 5,443, compared with only 545 under the GST.
The minister noted among improvements made to the tax system included setting the sales threshold for service tax registration at RM500,000 annually. He also said SST will only be imposed on restaurants with an annual turnover of RM1 million.
The Selangor International Business Summit 2018, which will be held at the Malaysia International Trade & Exhibition Centre (Mitec) in Kuala Lumpur, is a series of three tradeshows, namely the Selangor International Expo 2018, Selangor Asean Business Conference 2018 and Selangor Smart City & Digital Economy Convention 2018.
Invest Selangor Bhd and Menteri Besar Selangor Inc are the co-organisers of these tradeshows, which will run from 6th to 16th September 2018.
Throughout this tradeshow, Tea Trade Association of Malaysia will host the friendly competition of Battle of Teh Tarik 2018. “Our members are happy to promote the various tea culture Malaysians endear to, be it teh tarik or the art of brewing and sipping on hot tea,” Lee said.
“As for chinese tea, we mainly import from China and Taiwan. Over the decades, we see a gradual shift in chinese preference from oo long tea to pu er tea,” he added.
Malaysia imports some 3,000 tonnes of tea leaves a year. “We import different types of tea leaves from Sri Lanka, Japan, China, Taiwan and Indonesia. That translates to 900g of per capita consumption.”
When asked on tea drinking trend among Malaysians, Yu Ting Trading Sdn Bhd chief executive officer William Lee, who is a green tea importer, said the culture of ‘yum cha’ or tea sipping is becoming a social norm among the younger generation and not just among the elders.
“Green tea is good for health and scientific studies have shown that sipping on a hot cup of tea does help in stress relief,” William added.
When asked if members of Tea Trade Association of Malaysia would raise price of tea leaves being sold to restaurateurs and hoteliers, Lee said, “it’s really up to each business whether or not to pass on or to absorb it.
“The cost increase from the SST on print and packaging materials is minimal. So, it’s very likely our members would absorb it in view of healthy competition,” he added.