PETALING JAYA: The Customs Department has emphasised that a wide range of goods will be exempted from the Sales and Services Tax (SST), which is set to be reintroduced on Sept 1.
At a press conference today, its director-general Datuk Seri Subromaniam Tholasy said that the SST will be implemented on a narrower tax base, compared to the Goods and Services Tax (GST), which has been zero-rated.
He also said that the tax’s implementation should be smooth.
“SST is much simpler than GST. If we can implement GST, there is no reason we cannot implement SST.
“There will definitely be issues at the beginning, but we will work with business operators through the hand-holding programme,” he added.
Subromaniam said a majority of items will be zero-rated under SST. Some will be taxed five per cent, and some, 10 per cent.
“Today, we will upload (information to the) GST portal, which will soon be renamed SST.
“We will upload a list of items covered by the SST. (You will see that) most items are exempted from the SST,” he said, adding that there is no reason for prices of goods to go up.
According to Subromaniam, SST is expected to involve less than 100,000 manufacturers and service providers compared to 472,000 companies when the GST was implemented.
He said the reduction in number of parties involved would help the Customs Department to facilitate, review and monitor the implementation of SST where the filing and payment system will be done electronically.
“(The system) will not be the same as GST’s, as we have a new system and the old SST filing system was done manually. This time around, it will be done electronically,” he said.
On the issue of a potential rise in the price of goods, he said many factors contribute to price rises.
“(Tax) is one component of pricing. Many factors, however, are outside our control.
“Prices are dynamic, and depend on supply and demand factors, fuel prices (and others).
“Don’t just blame (price rise) on tax,” he said, adding that traders must not use SST’s implementation as an excuse to raise prices.
He said briefing sessions would be conducted nationwide from July 24 in preparation for the transition of the tax system.
He said a second round of briefing will be held after the bill is passed by the Parliament next month.