SME Association wants three-year grace period for full GST implementation

The Small Medium Enterprises (SME) Association wants the government to extend the grace period for full implementation of the Goods and Services Tax (GST)to three years.

This is to allow SME entrepreneurs to become familiar with the new tax.

Its President Teh Kee Sin said based on a seminar held in 11 locations, more than 80 per cent of the SME entrepreneurs did not know or understand the GST.

"The grace period to familiarise is too short. Do not penalise us, if there are some who are unable to understand the new tax, when it is implemented.

"The government has given a two-year timeframe, but we are hoping for a three-year grace period for SMEs," he told reporters here after officiating the GST Seminar for SMEs in Penang here today.

The GST will be implemented from April 1, 2015 at the rate of six per cent to replace the Sales and Services Tax (SST). The SST is at present set at 10 per cent and six per cent respectively.

Teh also urged the government to increase the value of the GST e-voucher for SMEs to purchase or improve their accounting software to be GST compliant, from RM1,000 to RM2,000, to reduce the burden of the entrepreneurs concerned.

Commenting on the seminar, Teh said more than 4,000 members attended 11 of the 30 seminars held throughout the country.

All the seminars are expected be completed within the next three months.