PETALING JAYA: Traders are smiling again now that business has improved by between 10% and 30% since the zero-rating of the Goods and Services Tax (GST) took effect earlier this month.
The Hari Raya celebrations and mid-term school holidays also provided another boost to sales figures.
Retail Group Malaysia managing director Tan Hai Hsin described the three-month tax holiday window as “exciting and vibrant” for the retail industry.
“Even Singaporeans have crossed over to Johor Baru on weekends to take advantage of the cheaper goods and they are buying more than usual,” he said.
But Tan said sales figures varied among retailers, depending on the products and the additional discounts given.
“Retailers selling high-value goods such as cars, electrical appliances and handphones, have enjoyed much higher sales as compared to those trading in daily necessities.
“As for hawkers, coffee shop operators and market stall traders, we do not expect them to reduce prices as they do not pay GST in the first place,” he said.
He said the retail industry’s growth rate for the third quarter of this year had been revised from 5.2% to 6.8%.
Malaysia Retail Chain Association president Datuk Garry Chua said their members have recorded a significant boost in retail sales.
“Sales have been good, especially for car companies, which have mostly seen a doubling in orders,” he said.
Malaysian Automotive Association president Datuk Aishah Ahmad said the projected total industry volume (TIV) of car sales for this year would be revised.
“Most car companies received a lot of bookings and delivery requests before the implementation of the Sales and Services Tax (SST) on Sept 1,” she said.
According to earlier reports, the TIV for the automotive industry was expected to grow 2.3% to 590,000 units this year as compared to 576,635 in 2017.
For certain industries, the effects of the 0% GST was taking more time to trickle down.
Malaysian Association of Tour and Travel Agents president Datuk Tan Kok Liang said he expected domestic travel to start picking up towards the end of August.
“Not many people have made travel bookings yet,” he said, citing air travel which needed to be booked in advance to enjoy lower rates.
He expressed confidence that Malaysians would still travel even after the SST was implemented due to better cash flow and spending power.
Association of Valuers, Property Managers, Estate Agents, Property Consultants in the Private Sector president Foo Gee Jen said it was too early to evaluate any surge in sales, especially as residential properties were already GST-exempted.
“But many developers are offering extra rebates to attract buyers,” he said.
Real Estate Housing and Developers Association past president Datuk Ng Seing Liong said the real impact on the property market could only be seen in another six months to a year.
“Building materials and labour costs would be down by 6%, leading to a reduction in selling price,” he said.
Savings notched up with zero-rated GST
Traders happy businesses picking up
Most food operators not reducing prices of items
‘Still plenty of GST complaints’