Buying spree in Malaysia to avoid 6% GST from April 1

PETALING JAYA (THE STAR/ASIA NEWS NETWORK) - Malaysia's Goods and Services Tax (GST) which will kick in on Wednesday has sent many consumers on a buying spree to avoid the new tax.

Despite being constantly reminded that the 6 per cent GST will not be a burden, a deluge of people converged on shopping centres, digital malls and even grocery chains over the weekend.

Several smartphone retailers in George Town, Penang, said they had run out of stock of the popular models because people were snapping these up to avoid paying GST on them.

The retailers said they were taking bookings now - if a customer is willing to make a down payment for a device before April 1, he would pay the current price (no GST) when the stock comes in later.

At the Digital Mall here, a retailer said there were so many people shopping for phones and other devices on the weekend that the mall stayed open till midnight. Normal business hours are 10am to 10pm.

Even pharmacists reported a spike in the number of customers. The people were stocking up on health supplements and medicines, especially those with long-term illnesses.

Several supermarkets, however, were dreading long queues and expected angry customers who may be confused over the new tax on Wednesday.

One operator in Johor Baru has tried to prepare its customers by putting up before-GST and after-GST price tags during the past few months, as well as handing out pamphlets on the matter.

But to be safe, its security guards have been told to be on the look out for enraged customers.

On Monday, trolleys were in short supply at several supermarkets because of the crowd.

One shopper said the people were queuing up at the trolley-return station.

Some restaurant owners were also just as worried about having to deal with angry customers who might refuse to pay the bill.

They said they dreaded having to collect the GST from their patrons, and one remembered a customer who turned violent when sales tax was first implemented years ago.

A new smartphone app from the Domestic Trade, Cooperatives and Consumerism Ministry will be helpful to those consumers wanting to double check the prices of goods.

The MyKira GST app is only for phones with the Android operating system and enables consumers to check the prices of more than 10,000 items and services.

On the plus side, the big retailers said they were all set for the GST.

Banners and signboards explaining the GST and zero-rated goods have been put up.

Some businesses said they hoped they would not be penalised for any initial mistakes they make concerning the GST.

In Johor Baru, the Chinese Chamber of Commerce said many of these businesses were still wrestling with implementing the new tax despite numerous briefings.

They hoped for a two-year grace period to adapt, particularly the small and medium enterprises.

According to the Customs Department, public confusion over the GST is expected to last about six months to a year.

One of the biggest hurdles for consumers would be the price differences between GST-registered and non-GST-registered businesses, it said.

It has set up a help desk hotline for the public to clear up any doubts about GST.

A book of Frequently Asked Questions on the GST, a Taxpayer Access Point handbook for businesses on tax returns and a multimedia video have also been launched.