JOHOR BARU: Owners of eateries here are adopting a “wait-and-see” approach in light of the expansion of the Sales and Service Tax (SST) and the announcement of a 25% tariff on imports from the United States to Malaysia.
Restaurant owner Norfaezah Borhan (pic), 38, said while the expansion of the SST does not directly affect restaurants or the cost of ingredients, other types of expenses have seen a rise.
“For now, I have yet to see any drastic increase in our operational cost, as the items we need to run the restaurant are not included in the expanded SST.
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“However, there are some noticeable increases in our operational cost in other areas.
“For example, I have already noticed an increase in logistics costs as some suppliers have hiked up delivery charges for the ingredients we need,” she said in an interview.
She said that while she does not intend to increase the prices of the food and drinks she sells, it may be necessary if she is forced to absorb the extra costs.
“I have already been absorbing additional costs before this due to things like the increase in minimum wage and the rising cost of ingredients over the past few years.
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“If I have to absorb even more because of this and the coming US tariffs, then I will have no choice but to increase my prices.
“I have no plans to raise my prices because they are still manageable, and I also want to avoid driving customers away.
“But if it becomes too much, then I will have no choice, as I also have to pay my workers,” Norfaezah said.
Echoing a similar sentiment was chicken rice seller William Yong, 51, who said he raised prices at his stall about four years ago.
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“I am not planning to increase my prices for now, as I know this will affect my customers.
“The SST has not affected my business. Sales have been encouraging lately,” he said.
Johor Indian Muslim Entrepreneurs Association (Perusim) secretary-general Hussein Ibrahim noted that most Indian Muslim (mamak) restaurants are adopting a cautious approach.
“The SST may affect high-end restaurants that serve food using fancy ingredients, but not mamak restaurants that serve simple food.
“As far as I know, there are no plans for mamak restaurants here to raise prices in response to the SST for now,” he said.
He added that the association is also looking into the impact of the US tariffs, which are expected to be imposed from Aug 1.
“We will have to wait and see. We don’t really know how the tariffs will affect mamak restaurants,” he said.
Johor Baru Business and Hawker Association president Roland Lim (pic) said that while there are no plans for his members to raise prices now, many of them are pausing plans for expansion.
“The construction and real estate sectors are among those affected by the expanded SST, and these changes will have a chain effect on others, including restaurant owners looking to expand their business.
“Many of my members who previously planned to expand have now decided to put them on hold, especially with the upcoming US tariffs.
“So while these issues do not directly cause restaurants to raise prices for now, they can impact other things,” he said.
Johor Domestic Trade and Cost of Living Ministry director Lilis Saslinda Pornomo reminded businesses not to use the SST as an excuse to raise prices.
“The public should report such matters to us so that the necessary actions can be taken,” she said.
