Prepaid Telco cards & GST: It’s a WIN-WIN-LOSE solution!

Prime Minister Datuk Seri Najib Razak appoints a new Top Dog and tells him to ‘take charge’. It’s Communication and Multimedia Minister Datuk Seri Ahmad Shabery Cheek.

It’s a WIN (the Government) WIN (telcos) LOSE (we, the users) solution!

Why?

1. The Government WINS as it collects GST of 60 sen on every RM10.
2. Telcos WIN as they get RM10 for RM10.
3. We, the users, LOSE as we pay GST of 6% which works out to 60 sen of RM10. Thus we get RM9.40 for each RM10 we pay.

Malay Mail Online

No GST on prepaid reloads but tax on usage, Putrajaya says

By Mayuri Mei Lin

PUTRAJAYA, May 13 ― Putrajaya announced today that mobile prepaid users will not be charged the Goods and Services Tax (GST) when purchasing reloads but will have to pay the 6 per cent consumption tax upon using the service.

Communications and Multimedia Minister Datuk Seri Ahmad Shabery Cheek explained that users who purchase an RM10 mobile prepaid reload will receive an RM10 credit upon activation but will subsequently be taxed on their usage of each call and text message as well as data.

“Today the Cabinet decided to agree with the ministry’s suggestion so that prepaid mobile reloads sold at RM10 will receive RM10 upon activation,

“The GST tax for the prepaid value will be charged on the usage or usage-based,

“The government views this as a fair way as the government does not collect taxes before the service is used,” Ahmad Shabery told a press conference today.

This new system, however, will not be implemented for another six months, he said.

– See more at: http://www.themalaymailonline.com/malaysia/article/no-gst-on-prepaid-reloads-but-tax-on-usage-putrajaya-says?utm_medium=twitter&utm_source=twitterfeed#sthash.EzcSaR8D.dpuf

If we get RM10 for RM10 prepaid top-ups, does it mean that there is no GST of 6% or does he mean that he will ask the telcos to paid the GST of 6%?

Star

Tuesday May 5, 2015 MYT 12:02:28 AM

Ahmad Shabery proposes RM10 for RM10 prepaid top-ups

PETALING JAYA: Datuk Seri Ahmad Shabery Cheek wants a “third” choice to resolve the issue relating to prepaid top-up cards.

Based on the people’s feedback, the Commu­nications and Multimedia Minister said mobile prepaid reloads should have the same airtime value as the listed prices.

Currently, prepaid top-up users are paying RM10.60, leaving RM10 in credit following the implementation of the Goods and Services Tax (GST).

Another option being considered is to pay RM10 and have RM9.43 in credit upon deduction.

Ahmad Shabery said he was not satisfied with existing solutions for prepaid top-ups.

“So the choice was to whether pay RM10.60 for RM10 worth of credit or to get RM9.43 upon paying RM10.

“To me, this is not relevant, because there is no third choice then,” said Ahmad Shabery on the Suara Kita Hak Kita programme over Radio Televisyen Malaysia (RTM) on Monday.

According to Ahmad Shabery, the rakyat’s feedback was an overwhelming support for paying just RM10 for the same amount of credit.

“We will find a mechanism so the rakyat can buy RM10, and get RM10 value.

“And when I get their (telco CEOs and Customs Department) decision, I will bring it up to Cabinet next week, and say this is the decision we want,” he added.

Ahmad Shabery said the issue could not be solved “within two days”, and time is needed to reconfigure the systems involved to accommodate any changes.

http://www.thestar.com.my/News/Nation/2015/05/04/Shabery-Cheek-telcos/?utm_source=dlvr.it&utm_medium=twitter

Malay Mail Online

After flip-flop on mobile prepaid GST, PM tells minister to ‘take charge’

KUALA LUMPUR, May 1 — Prime Minister Datuk Seri Najib Razak today told a minister to “take charge” of an on-going issue related to the pricing of mobile phone prepaid top-ups, a month after consumers were given a run-around on how much they need to pay under the Goods and Services Tax (GST) regime.

Taking to micro-blogging site Twitter, Najib declared that Communication and Multimedia Minister Datuk Seri Ahmad Shabery Cheek will be the only authorised government spokesman on the new price scheme.

“@shaberyc Pls take charge of the topup issue. Mulai skrg, sebarang pengumuman kpd rkyt hanya boleh dibuat oleh Menteri KKMM sahaja.” Najib wrote on his official Twitter account @NajibRazak today, referring to the Malay acronym for Shabery’s ministry.

[Translation: @shaberyc Pls take charge of the topup issue. From now on, any announcement to the public can only be made by the Minister KKMM only.]

Najib’s tweet today attracted a flurry of responses from other Twitter users, with one identified as Salahdin quizzing the decision to appoint Shabery for the task when the GST and price monitoring comes under the Ministry of Finance (MOF) and the Ministry of Domestic Trade, Co-operatives and Consumerism (KPDNKK) respectively.

“Why is it so PM @NajibRazak GST is regulated by ur MOF and price hikes are regulated by @mykpdnkk Why @shaberyc? Cauz he speaks 4 telcos?” the Twitter user wrote using the handle @saladinMY.

Over the past month, government officials have issued conflicting messages over the prices of prepaid reload coupons under the GST scheme.

Telcos had in the past absorbed the now-abolished sales tax of six per cent, which is now replaced by the GST that is also at a rate of six per cent but passed on to consumers.

There was a public backlash on the very first day of GST implementation on April 1, with complaints of higher cost of reload coupons despite an earlier assurance by deputy Finance Minister Datuk Ahmad Maslan that there would be no price increases for prepaid users.

On April 29, the Customs Department director-general Datuk Seri Khazali Ahmad said telcos must revert the prices for prepaid reload coupons to pre-GST levels by May 1, which means a RM10 top-up card would be sold at a GST-inclusive price RM10 with lesser airtime credit .

But just hours later, the Malaysian Communications and Multimedia Commission (MCMC) said prepaid reload coupons will still be sold with GST added on to the price, meaning Malaysians will buy a top-up coupon valued at an airtime credit of RM10 for RM10.60.

– See more at: http://www.themalaymailonline.com/malaysia/article/after-flip-flop-on-mobile-prepaid-gst-pm-tells-minister-to-take-charge#sthash.kqgKG1Ni.dpuf

NOW WE KNOW WHO IS TOP DOG. Actually, both are small fry.

Star

Thursday April 30, 2015 MYT 2:44:58 PM

Customs: No change in mobile prepaid reload prices

PUTRAJAYA: In a quick turnaround, the Customs Department has indefinitely postponed its directive to revert mobile prepaid reload card prices to pre-GST levels on Friday.

Director-general Datuk Seri Khazali Ahmad said the postponement was in response to a statement by MCMC.

“In line with the announcement by MCMC that telcos are still conducting a study on the implementation of GST on prepaid reload cards, the directive by the Customs Department to revert to pre-GST prices on May 1 is postponed,” said Khazali in a brief media statement Thursday.

http://www.thestar.com.my/News/Nation/2015/04/30/Customs-Department-Pre-paid-revert-Pre-GST/?utm_source=dlvr.it&utm_medium=twitter

NO GOOD NEWS YET WHILE WE WAIT TO SEE WHO IS TOP DOG.

Customs director Khazali Ahmad said the cards will be sold at  pre-GST prices starting Friday, 1 May 2015.

This is contradicted by MCMC chairperson Halim Shafie who said it is too complicated to revert to pre-GST pricing by May 1.

The government earlier this year said the prices of prepaid mobile top-up cards will remain the same with GST.

However, instead of replacing the service tax component with GST, the telcos absorbed the service tax component and added the GST on top of the price.

http://www.malaysiakini.com/news/296823?hootPostID=b450eb80e28922f8c424e744896f0faf

unnamed

http://www.malaysiakini.com/news/294138

6:50PM Apr 29, 2015

Malaysiakini

Customs, MCMC butt heads over prepaid cards

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The Royal Customs Department and Malaysian Communications and Multimedia Commission today issued contradicting statements over the new prices for the mobile prepaid top-up cards.

Customs director Khazali Ahmad said the cards will be sold at  pre-goods and services tax prices starting Friday.

Khazali said he has personally instructed all four telecommunication companies to reinstate the pre-GST prices starting May 1, in a letter yesterday.

“The telcos must comply to an instruction by the Customs Department director. It doesn’t mater if the prepaid cards are old or new stock,” he was quoted by Bernama as saying.

He said this means users who pay RM10 for the prepaid card will get the same value of credit, starting May 1.

This is contradicted by MCMC chairperson Halim Shafie who said consumers will have to pay RM10.60 for RM10 worth of mobile credit. The extra 60 sen is for GST.

Alternatively, he said, consumers can pay RM10, but enjoy only RM9.40 in mobile credit after GST is deducted.

He said it is too complicated to revert to pre-GST pricing by May 1.

It will mean telcos, financial institutions, electronic payment proiders and some 30,000 sales agents will have to reconfigure their systems, Halim said.

He added that the Customs Department is acting “prematurely” since results for the consumer survey on pricing has yet to be reviewed.

http://www.malaysiakini.com/news/296823?hootPostID=b450eb80e28922f8c424e744896f0faf

Star

Wednesday April 29, 2015 MYT 2:51:47 PM

Prepaid reloads back to pre-GST rates from May 1

PUTRAJAYA: Telecommunication companies will revert to the old pricing for prepaid reloads from May 1.

Customs director-general Datuk Seri Khazali Ahmad said the telcos had been informed to revert to the rates before the implementation of the Goods and Services Tax (GST) on April 1.

This means that a RM10 top-up would cost RM10 instead of GST-inclusive RM10.60.

“We understand the problems affecting youngsters, who are the main prepaid users.

“Effective May 1, all telcos must revert to prices before April 1 where the price is inclusive of tax,” he told a press conference.

http://www.thestar.com.my/News/Nation/2015/04/29/MCMC-no-reversion-yet-prepaid/?utm_source=dlvr.it&utm_medium=twitter

Star

Wednesday April 29, 2015 MYT 4:55:19 PM

MCMC: Impossible to revert prepaid reloads to pre-GST prices immediately

CYBERJAYA: It will be impossible to bring down prices of prepaid reloads to pre-GST (Goods and Service Tax) levels immediately, due to the huge logistics involved in implementing the change, said the Malaysian Communications and Multimedia Commission (MCMC).

For now, prices of RM10 prepaid reloads will remain at RM10.60, with 6% GST applied, clarified MCMC chairman Datuk Sri Dr Halim Shafie.

In a press statement released Wednesday, Dr Halim said it will be difficult to go back to pre-GST prices due to the complexities in reconfiguring the systems, by both service providers and third-party agents.

He said the cost of doing this would be significant for all parties involved, and new stocks of prepaid cards had to be produced and distributed nationwide.

http://www.thestar.com.my/News/Nation/2015/04/29/MCMC-no-reversion-yet-prepaid/?utm_source=dlvr.it&utm_medium=twitter

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This entry was posted in MCMC versus Customs dept, prepaid cards and GST, prepaid telco cards and tagged , . Bookmark the permalink.

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