There are approximately nine million households in Malaysia, each having an average of four persons (Selected Demographics Indicators Malaysia, 2018, Department Statistics Malaysia). Using this figure, a household would have to spend RM120 per month or RM600 until year end (Aug 1, when wearing of face mask in public areas was made compulsory, to Dec 31) to purchase disposable face masks, assuming each piece costs RM1.
This computation extends to Dec 31 because the taxable period for individuals follows the calendar year. (Hopefully, the pandemic would have resolved by then.)
There are two extremes in the preferences for face masks. Some choose to the wear re-usable types, which are more expensive, while others opt for the cheaper disposable ones. But whatever they opt for, people still need to pay for the masks for as long as it is mandatory to wear them. On top of this, people also have to spend on sanitisers, soaps and detergents to maintain cleanliness, which adds to their financial burden.
If purchase of face masks is made tax-deductible, people would not hesitate to buy and wear them. Companies could also purchase masks for their employees and the public to make good use of the tax “benefit”.
People might also opt for the more expensive re-usable face masks, thus reducing the use of the disposable type, which, because they are discarded by the millions daily, are doing damage to the environment.
Setting a ceiling price for disposable face masks is meant to ensure that everyone can afford to buy them. Perhaps the government could also consider alternative methods to manage/control the pricing of face masks in a way that’s also good for the country’s coffers.
The first method is to provide tax exemption on income solely related to sales of disposable face masks to sellers and/or manufacturers who are complying with the ceiling price.
The second method is to fully tax sellers and/or manufacturers who sell disposable face masks above the ceiling price.
Currently, there are many avenues to purchase disposable face masks, hence the enforcement of the ceiling price will be quite a gigantic task for the authority concerned.
By applying the first method, the onus shall be on the sellers and/or manufactures to show their compliance with the ceiling price in order to enjoy the tax exemption.
Inevitably, certain types of face masks will cost more to make as the manufacturers must carry out quality assurance and control tests on their products so that they conform to the applicable standards. The second method would allow the manufacturers to sell their face mask without loss but they will be fully taxed.
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