Published on: Sunday, February 07, 2010 |
Kota Kinabalu: The Consumer Movement of Sabah and Labuan (Cash) again called on the Government to fully abolish the Cabotage Policy and improve infrastructure in the State before implementing the Goods and Services Tax (GST).
Its President, Datuk Patrick Sindu, said the relevant monitoring and enforcement authority should also increase its personnel.
He said if the government just bulldozed the GST through, the end-user or the consumers would be the ones bearing the effect of the all-encompassing tax.
"The Government said not to worry because it will implement the anti-profiteering law. But I was informed that the Domestic Trade and Consumer Affairs Ministry does not even have enough personnel to monitor Sabah," he said.
If this is the case, how would it be possible for the authority to ensure traders or businessmen do not take advantage of the GST to raise prices of goods indiscriminately?, he asked.
As of now, he said the prices of goods in Sabah are already 20 per cent higher than in the peninsula.
Finance Ministry Tax Revision Panel Secretariat Chairman, Datuk Kamariah Hussain had on Thursday announced that the GST rate is only four per cent but Sindu said it could be manipulated by certain unscrupulous quarters for their gain.
Instead, he said the Government ought to focus on its transformation programmes because the GST is more suited for developed nations.
"Our infrastructure in Sabah is still below par and now the government is introducing the GST, which is another mode of tax meant to create revenue for the government," he said.
He said if the government could not improve the present infrastructure and stop all illegal activities such as sugar hoarding, pirated CDs and smuggling of contraband, the GST should be shelved until all the problems have been settled.
According to Sindu, most people he met disagree with the GST because basic infrastructure in many places had yet to be built or improved.
Kamariah on Thursday said prices of certain goods such as shoes and clothing would actually drop by about 2.7 per cent if the GST is implemented.
Under the present goods and sales taxes, the rate is five per cent and 10 per cent respectively unlike the GST, which is only four per cent.
Further, she said with the GST in place, they estimated that the consumer price index (CPI) could actually go down by 1.9 per cent.
However, she said not all prices of goods and services would go down because of the element of transportation costs from the peninsula to Sabah which causes the price of goods and services in Sabah to be higher than in the peninsula.
She said the rate or services such as recreation, private health care and education would increase by about two per cent.
Nevertheless, she said the GST would not affect the lower income group as certain basic foodstuff including rice, sugar, salt, flour, eggs, meat and chicken as well as the first 200 units of electricity and 35 cubic metres of water consumed were exempted.
