Go Zero

If you’ re go­ing“WTF” about GST, the ex­perts lay­out how it af­fects your bud­get.

CLEO (Malaysia) - - CONTENTS -

We break down the What in WTF on GST and how it af­fects you

When GST came in, many re­mem­ber t he sharp rise in costs. We felt it. As a re­sult of Malaysia’s 14th Gen­eral Elec­tion , t he new gov­ern­ment has worked to ful­fill their zero-rated GST prom­ise. As at 1 June, GST was zero - rated.

With this , came some con­fu­sion. Here, Andy Gan, an as­so­ciate mem­ber of Char­tered In­sti­tute of Man­age­ment Ac­coun­tant ( CIMA) and Char­tered Global Man­age­ment Ac­coun­tants ( CGMA) who also founded an IGCSE Cen­tre, Twins Ed­u­ca­tion, and Ian Wong, a li­censed fi­nan­cial plan­ner, ex­plain how this af­fects your coin and every­day spend­ing.

WHY SO HIGH?

Pr e-G ST, not ev­ery­thing was sub­ject to ser­vice tax. But when GST came in, t here was a sud­den spike in prices. Ac­cord­ing to Ian Wong, there were two main rea­sons to ex­plain what hap­pened: “Goods that pre­vi­ously did not in cur a Ser­vice Tax sud­denly had to charge GST. Goods t hat were pre­vi­ously fac­tor­ing in the Sales Tax of 10%, main­tained the same price even af­ter the re­moval of the Sales Tax. Then, these busi­nesses slapped on the 6% GST. In this sit­u­a­tion, the 6% GS Tis ac­tu­ally a lower tax, and should have ac­tu­ally re­sulted in a re­duc­tion in prices .” Who would’ve thought that, with the soar­ing prices we saw in­stead, right?

JUST WAIT FOR IT...

Zero - rated GST doesn’t mean that things will be cheaper for­ever. We’ re not charged t he ad­di­tional t ax on our pur­chase, un­til Sales and Ser­vices Tax( SST) kick sin on 1 Septem­ber 2018. And be­fore you think that GST/ tax any­thing is t he one solely af­fect­ing prices, there are other things as well . Andy Gan says , “Con­sider other f ac­tors , like the weak­en­ing of the ring git, in­creas­ing house­hold debts and t he na­tional debt.” So ac­tu­ally, it mat­ter show well the coun­try is do­ing as a whole.

GST vs SST

In the eye sofa shop a holic,Andy Gan be­lieves that SS Tis a bet­ter choice for the short term. How­ever, he adds: “Whether prices will re­ally de­crease is de­bat­able as it will be de­ter­mined by mar­ket force sat the end of the day .” Which sup­ports Ian’ s point ,“Once the SST is in place, some costs will rise again. How much it rises will de­pend on the rate of the SST, which has not been set yet.”

While this is fine and dandy, just re­mem­ber that there are ways to save some money in times when the urge to Add To Cart is just too un­bear­able.

More money to you!

Newspapers in English

Newspapers from Malaysia

© PressReader. All rights reserved.