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New SST rates: No reports on price hike in Kedah, but consumer group wary of impact on supply chain

ALOR STAR: There has been no official report regarding price hikes in Kedah since changes in service tax rates that took effect on March 1.

Director of the Domestic Trade and Cost of Living Ministry's Kedah office,Muhammad Nizam Jamaludin said the ministry has not received any complaint on goods price hike in the first four days.

"Following the announcement on the new SST rates effective March 1, until today there has not been a single report on price hikes in Kedah," he said when contacted.

Nizam urged consumers to report to the ministry if they suspect any act of profiteering by traders following the upward revisions of SST rates.

He said consumers may lodge their complaints through various platforms namely the ministry's http://eaduan.kpdn.gov.my; call centre at 1-800-886-800; via email to e-aduan@kpdn.gov.my; Enforcement Command Centre at 03-88826088/6245; WhatsAppp at 019-848 8000 and 019-279 4317; and the ministry's Kedah office at 04-7001745.

Meanwhile, Kedah Consumer Association (Cake) president Yusrizal Yusoff also confirmed that it has not received any complaints from the public regarding price hikes linked to the sales tax rate revision.

"Perhaps the traders realised that if they suddenly hike up the prices, it will backfire on them," he said.

Yusrizal also attributed the current calm market response to enforcement carried out by the ministry.

"I spotted ministry enforcement going to the ground carrying out price checks, that is a good move but we hope the ministry will focus more on small scale retailers, not just hypermarkets and chain stores," he said in an interview at his office.

Yusrizal expressed concern on the potential risk of traders and retailers hiking up their prices later.

"We cannot tell for sure how long the traders and retailers will be able to absorb the additional cost that has been passed down by the manufacturers and wholesalers.

"Our main concern is there could be some price hike due to expected higher demand for essential items during this month of Ramadan followed preparations for the Hari Raya festive season," he said.

Yusrizal said the onus is on the government to explain to the people on how the service tax revision would have an impact on goods price in the market.

"Since the sales tax is not a structured taxation system, as agreed by many experts, we wish to reiterate our concern that there could be a multiplying charge of the tax from production down to the end users.

"We are talking about the eight per cent tax imposed by manufacturers to wholesalers which is being collected by the Customs Department.

"The wholesalers will then impose the tax on another level of wholesalers or the retailers. The more levels are involved before the goods arrive to the end users, the more it will multiply. It is not impossible that it can snowball up to 24 or even 32 per cent," he said.

He said besides the service tax revision, the higher cost of imported input material due to weakening ringgit may also fuel a price hike for goods.

As such, Yusrizal urged the public to play their role in equipping themselves with knowledge on how to identify profiteering activity and report the matter to the authorities.

"Not many consumers are aware that any party involved in goods supply chain that takes over 50 to 60 per cent profit margin is committing profiteering.

"This is where consumers knowledge is important so that they can report any act of profiteering to the right authority so that action could be taken," he said.

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