Public should not worry as GST price increases are one-off only, says Customs D-G

KUALA LUMPUR: The public should not worry about the implementation of the Goods and Services Tax (GST) as there would only be a one-off increase in goods prices, said Customs Director-General Datuk Seri Khazali Ahmad.

He added that goods prices would stabilise within a year of the implementation of GST, set for April 15 2015.

"Based on a study, there will be a slight price increase, which is 'one off', of 1.4 to 1.8 per cent, but it will be stable in a year," said Khazali. 

Khazali said this after closing the National GST Conference, which was jointly organised by Bernama and the Tax Advisory and Management Services Sdn Bhd (TAMS) last Thursday.

He said that based on a survey conducted by the Customs Department, the people were worried that implementation of GST would change their lifestyle.

 "The people should dismiss the perception that GST will change their lifestyle because the Customs Department has done a simulation to test the impact of GST and found that traders have no reason to increase price indiscriminately," he added.

 Khazali added that traders could claim the six percent tax they had to pay from the government. 

During the Dewan Negara sitting on May 5 this year, Deputy Finance Minister Datuk Ahmad said GST would be imposed on 689 goods with the price of 73 of these items to go up, while the price of 287 items to go down and 329 items would remain at the same price after the tax.

Prime Minister Datuk Seri Najib Tun Razak when tabling Budget 2014 announced the implementation of GST. GST will be implemented effective April 1, 2015 at a fixed rate of six per cent to replace the Sales and Services Tax at 16 per cent. - Bernama