PETALING JAYA: Small and medium enterprises (SMEs) have raised concerns over the rising prices of the GST-compliant software and the hiking of fees by financial consultants that manage their financial books as the implementation of good and services tax (GST) drew near.
As per the Customs Department, the GST-compliant software is an accounting programme that has GST features or elements for recording transactions.
Despite these concerns, SMEs are still buying the software to prepare themselves and some vendors are enjoying brisk sales from last-minute demand for GST-compliant software.
Some vendors were charging more than RM2,000 for a basic version software, even though the original cost was only between RM1,000 and RM1,500, sources said.
The advanced versions are more expensive and catered to the requirements of mixed suppliers group (for businesses with both taxed and non-taxable supply items).
“We bought it for more than RM2,000 and now we found out that it is only about RM1,000,’’ said someone who runs a SME and who requested anonymity.
However, Finance Ministry tax division deputy under secretary M.A. Sivanesan made it clear that the cost of a basic software was from RM1,000 to RM1,500.
But he confirmed that the cost for the advanced versions were more expensive as pointed out by some vendors.
“With the wide range of software with GST features available in the market, businesses must make the right choice according to their business requirement and not be compelled to purchase software with features that are not required.
“The prices vary depending on the number of users allowed to use the system, the level of customatisation and storage capacity,” he said in an e-mail reply to queries from StarBiz, adding that affordable cloud versions were also available in the market.
Sivanesan said that for SMEs, the basic software was sufficient to manage day-to-day work and they should utilise the RM1,000 grant provided by the Government to purchase the accounting software with GST features, adding that there were more than 100 approved software vendors under the Customs Department’s list to choose from.
For those who are seeking financial consultants’ services, Sivanesan recommended that businesses owned a proper accounting system and that staff were trained to ensure compliance to GST. “Nonetheless, the Customs Department is ever ready to advise on matters related to GST,” he assured.
As for those who increase prices of products and goods with GST as an excuse, Sivanesan said consumers might lodge a complaint with the Domestic Trade, Co-operative and Consumerism Ministry.
“As per the Prime Minister’s announcement in Budget 2015, many items would see a price reduction post-GST. “Therefore, there is no reason for businesses to hike prices,” he added.
Meanwhile, Leap Forth managing director and GST consultant Chee Hong Seng said while GST was a long-term measure towards achieving a high-income nation status, it was pertinent that businesses considered their requirements before purchasing any software with GST features.
He said those without accounting background might end up buying a software that did not serve their business needs, and over-pay for a very basic version.
Chee explained that GST-compliant software simply meant that a software with GST features/elements and that businesses should not be baffled by the term.
“The accounting software with GST features ranges from RM1,000 to above RM10,000. The actual price depends on the brand and features of the accounting software. The list of approved accounting software and their price range can be obtained from the Customs Department website,” Chee said.
He noted that over the last few years, the software market had moved towards the concept of software as a service (Saas), which is a software licensing and delivery model, licensed on a subscription basis and usually centrally hosted (or data stored in the cloud).
“Instead of spending a few thousand ringgit to buy an accounting software, businesses can actually subscribe for it online by paying a fixed monthly subscription fee, from as low as RM100 per month, depending on the features,” he said, adding that the subscription can be cancelled anytime if it did not meet the business requirement.
He advised those seeking help of financial consultants to shop around and obtain an affordable quotation before making any decision.
Branding Association of Malaysia president Datuk Eric Chong is a firm believer of a fair system.
“The software market has become so competitive due to the demand for GST-compliant software.
“Therefore, early players will reap profits by hiking prices for the software and enjoy ‘blue ocean’ for a while.
(Blue ocean exists when no firms currently operate, leaving the company to expand without competition).
“However, to sustain long term in the market, software vendors must be fair and should not indiscriminately increase prices,” he said, adding that the vendors should be considerate as it was not easy for SMEs to adjust to the new tax structure.