Standardized food pricing
KOTA KINABALU: The Ministry of Health and People’s Well-being is looking into standardized pricing for common food and beverages sold at coffee shops and restaurants in the lower price category.
Its minister, Stephen Wong, held the first engagement session with stakeholders here yesterday, which comprised 18 representatives from the West Coast Coffee Shop Association, Persatuan Peniaga Peniaga India Muslim Sabah (Pimsa), Malaysia Singapore Coffee Shop Proprietors General Association and Sabah Restaurants Fellowship Association.
Wong said the associations would be given time till June 27 to work out the proposed pricing for common drinks and food such as chicken rice, economy rice and kon lau mee.
Action will be taken on coffee shops and restaurants that refuse to abide by the standardized pricing once it is implemented, he warned at a press conference held after the meeting.
Wong said the ministry took the initiative to invite traders, coffee shop and restaurant operators for a dialogue owing to public complaints received over the unreasonable pricing.
He said the ministry’s intention is to monitor the pricing of coffee shops and restaurants to ensure businesses would not raise their prices unreasonably.
He pointed out that prices of drinks could vary substantially from RM1.60 to RM2.40 for coffee, teh c or teh tarik; RM2.80 to RM4.30 for a Milo beverage; and even RM1 to RM1.50 for plain water or Chinese tea, which were considered unreasonable.
Wong noted that the response from the associations had been positive, adding that they were willing to work out a reasonable, standardized pricing themselves to ensure a win-win outcome for businesses, the government and consumers.
He said the implementation of standardized pricing would start with coffee shops and restaurants in the lower price category, which is generally patronised by most consumers.
Asked if the higher rentals in the city centre justify pricier food and drinks, he said that factor had been taken into consideration.
Nonetheless, he said food and beverage operators would have saved hundreds of ringgit in rental when the Goods and Services Tax (GST) was zero rated on June 1.
“The pricing should not be more expensive than last time (when six percent GST was implemented) or even maintained as before. That is not reasonable.
“Prices must drop because there is no more GST imposed on rental,” Wong said.
He said raw materials and shop rentals should be cheaper now with zero percent GST.
“Coffee shops cannot give the excuse that they had absorbed the (six percent) GST last time and therefore will not reduce their prices when the GST has been zero-rated,” he said.
Nevertheless, Wong said the ministry would refer to the study on pricing trends for food and beverages according to districts done by the Ministry of Domestic Trade, Co-operatives and Consumerism (KPDNKK) in its recommendations.
He said pricing is not expected to be the same for Kota Kinabalu, Sandakan, Tawau, Keningau and Tenom.
“But the pricing should be more or less the same in Kota Kinabalu, not up to RM1 difference for teh c,” he said.
Wong said coffee shops and restaurants would have to abide by the standardized pricing upon implementation otherwise action shall be taken. That said, he hoped the government would not have to exert its authority to enforce the standardized pricing.
“We hope businesses can make this a win-win situation in a harmonious way,” he said.
At the same time, Wong vowed to look into the issues raised by the associations, including the high cost of goods and high water tariff.
Also present were the permanent secretary to the ministry, Janet K.L. Chee and political secretary to the ministry cum Luyang assemblyman, Phoong Jin Zhe.