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Labuan Task Force is told to be firm
Published on: Tuesday, October 18, 2016

Labuan: The Labuan Chinese Chamber of Commerce (LCCC) wants the Special Task Force set up over the proposed Customs restrictions on the island to immediately intervene and halt the department from enforcing its strict rules on sales of cigarettes and liquor.

It said not to do so would render the Task Force as merely an eye-wash and serving no useful purpose for Labuan.

Its Chairman Datuk Wong Kii Yii said this in reference to the recent announcement by Deputy Director-General (Customs and Goods and Service Tax) Datuk Zulkifli Yahaya that the new rules would be enforced here effective Nov 1.

"How could the department go ahead when the Special Task Force established by the Federal Cabinet and chaired by Deputy Prime Minister Datuk Seri Zahid Hamidi had so far only one meeting to address Labuan woes and not even completed its findings nor decisions on issues affecting Labuan's economy," said Wong.

He said he spoke to a Task Force member, Datuk Suhaili Abdul Rahman on Sunday about the Customs intentions and that Suhaili, who was the former Member of Parliament, was taken aback on the hurried steps taken by the department.

"He (Suhaili) informed me that the Task Force was, in fact, planning to hold its second meeting in Labuan in November," he said.

Wong said the differing views and actions of the Task Force and the department was causing confusing and anxiety among traders in Labuan and the Task Force should, without delay, put its feet down on the matter.

"It would be pointless to close the stable gates after the horses had bolted, meaning to say when action had already been taken by Customs, the damage would have been done and it would have been too late for repair."

Wong added that the Task Force formed by the Cabinet was meant to be the superior body.

"But it does not seem so under the present circumstances as seen by the Customs disregard on the purpose of the Task Force."

He reminded that the strict rules would have wide-ranging negative effects on the local economy as it would not merely affect a handful of them but scores of them running mini-marts, sundry shops and coffee shops.

It may also diminish Labuan's appeal as a free port as the sales of these items were essential for the shops at the grassroots level to strike a reasonable volume of business and prop-up income to pay high business costs.

The Customs should be helping in boosting the local economy and not kill Labuan just because of its own failure to curb smuggling."

Wong also asked why only a few shops were elected for KCB (Kedai Chukai Bebas) and issued with licences to sell duty-free beer and cigarettes. He said most of the favoured shops were well-established big enterprises.

"The Customs move smacks of discrimination as it is crippling the small fry but helping the big boys in the industry."

He also said the new procedure requiring KCB shops to deposit a bank guarantee based on the value of the goods plus duty payable would impose another burden to many because it was not easy to secure unsecured bank guarantee from banks.

"Even if they managed to get the guarantee, they would be stretching into their reserves.

Wong said the local economy was already down by 40 per cent due to the decline of the oil and gas sector and many of the local traders were licking their wounds.

"The Customs new rules would be rubbing salt into their injury."

On another note, Wong was also shocked by the report on Oct 7 which quoted the Customs D-G as saying that "We (Customs) have not received any complaints on the implementation from any party."

He said all the chambers had complained about this and the chambers represent the traders.

"Is the D-G implying that these traders have to complain individually in order to be heard."

He said the Chamber had several meeting with the FT Minister and the Deputy Minister of Finance and some of the meetings were attended by officials from Customs. "Thus, we find the D-G claiming that one had complained as most ridiculous."

At his informal meeting with Suhaili, Wong presented the Chamber's complaints about the issues for the Task Force Chairman."

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