Impossible for prepaid reloads to return to pre-GST rates on May 1 - MCMC

Malaysian Communications and Multimedia Commission (MCMC) today clarified that prepaid reloads will continue to be sold with the GST added to the reload amount, partly due to the complexities in reconfiguring the systems.

MCMC Chairman Datuk Seri Dr Halim Shafie said a survey to assess if customers prefer lower reload values on which GST will be charged.

For example, a RM10.00 reload could be RM10.60 (RM10 reload plus 6 per cent GST added) or RM10.00 (RM9.43 reload plus 6 per cent GST added).

“However, there has been some confusion in the market as to whether prepaid reloads will be back to pre-GST rates from May 1,” said Dr Halim.

“Unfortunately, it will be almost impossible for the service providers to implement the required changes in the next two days. Secondly, the results of the survey are not yet available and it may be premature to make any decisions at this point in time,” he added.

Dr Halim added, the difficulty in reverting back to the pre-GST arrangements are due to the complexities in reconfiguring the systems, not only on the part of the service providers but also on third party agents such as financial institutions, electronic payment providers, supermarkets, petrol stations and all other sales agents totaling approximately 30,000 parties.

Earlier, Customs director-general Datuk Seri Khazali Ahmad said telecommunication companies have been told to revert to the original rates before the implementation of the GST.

Bahasa Malaysia daily, Sinar Harian reported all four telecommunication companies have been directed to retain the original costs of prepaid cards according to the tax inclusive concept effective May 1 according to a letter sent to them on April 28.

Khazali was quoted as saying that whether the prepaid cards in the possession of telcos are old or new remains a non-issue for telcos to adhere to directive.

When asked to comment on the two contradicting Press statements issued on Wednesday, a Customs department insider said the Customs department implements the GST.

“The Press statement is by MCMC. The GST implementation is done by the Customs department so prepaid cards will return to the pre-GST rates, or at face value,” he told Astro AWANI.