Tyre association appeals for tax waiver, abolishment

KUCHING: The Sarawak Tyre Dealers and Retreaders Association has appealed to the state government to waive the 5 per cent state sales tax for last year and abolish the 2.5 per cent state sales tax this year on imported tyres.

Association president Lim King Hong said they did not charge customers the 5 per cent state sales tax last year and have not started charging the 2.5 per cent state sales tax so far this year.

“We insist that the Sarawak government should abolish the collection of state sales tax on imported tyres. The state government should not further burden Sarawakians, especially during these trying times,” he told a news conference yesterday.

The Sarawak government had imposed a 5 per cent state sales tax on imported tyres from Jan 1 last year.

The tax rate was reduced to 2.5 per cent, effective Jan 4 this year following requests from the association as well as Sarawak Bus Transport Companies Association, Sarawak Lorries Transport Association, and Kuching Bicycle and Motor Traders Association.

According to Lim, some smalltime dealers have been doing state sales tax submissions quarterly since last year, because they received letters from the authorities.

“Some did not submit because they did not receive the letter that demand them to do so,” he said.

Even though the state sales tax on imported tyres has been reduced from 5 to 2.5 per cent, he asserted that the additional cost would remain a financial burden for consumers in Sarawak.

He pointed out that the 2.5 per cent state sales tax was imposed on the selling price of imported tyres, which consumers would have to pay for.

“At present, we have not charged the 2.5 per cent state sales tax. The increase in selling price now is not from the state sales tax, but due to the increasing cost of raw materials for tyre manufacturing.

“The raw materials for tyre manufacturing has increased by double digits since end of last year. Additionally, the shipping charges of importing tyres also increased by more than double since end of last year,” he said.

Given Sarawak’s vast land size and longer travel distances, Lim said the use of tyres for business and travel would be more than in other parts of Malaysia.

“Tyres are essential to all transportation of people and goods. With the imposition of the state sales tax, it will definitely exacerbate inflation and burden the people.

“Because of this, the state government should not put additional costs to businesses and consumers, especially during this time of economic hardship,” he added.