Two business chambers representing companies in Malaysia and Singapore have issued a joint statement warning that "drastic increases" in Causeway charges will have a detrimental economic impact.
The Singapore Chinese Chamber of Commerce and Industry (SCCCI) and the Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM) also called for an "extensive study... to alleviate the burden on various parties".
The statement was issued after a meeting yesterday in Batu Pahat, Johor, where both chambers solicited feedback from members on the issue.
The ACCCIM is the SCCCI's counterpart in Malaysia.
In a move that has sparked widespread public criticism, the Malaysian authorities raised toll rates on Aug 1. Private cars entering Johor from Singapore now pay a toll of RM9.70 (S$3.80), up from RM2.90. Drivers going from Johor to Singapore previously paid no toll but now must pay RM6.80 when leaving Malaysia.
The Land Transport Authority said Singapore will increase charges to match Johor's.
Once this occurs, drivers making a round trip can expect to pay about $12.80 in tolls compared with $2.30 before the changes at the Malaysia checkpoint.
The Singapore authorities also raised the Vehicle Entry Permit (VEP) fee from $20 to $35 per day, from Aug 1. The Goods Vehicle Permit fee for foreign-registered vehicles also went up from $10 to $40 per calendar month.
While the increases in the VEP fee and toll charges will raise government revenue and reduce traffic congestion, "these drastic increases could deal a big blow to businesses of both countries", the two business chambers said.
Sectors such as transport, tourism, food and beverage, hospitality, retail and manufacturing are likely to be hit the hardest.
"At the same time, these drastic increases will have a domino effect on the prices of consumer goods, add to the burden of people and have a definite impact on their consumption ability."
Adjustments are acceptable, but the hikes should not be made too drastically or hastily, the statement added. The chambers urged both governments to "solicit relevant views and feedback" from the business community and general public.
Mr James Ow, executive chairman and chief executive of engineering service provider AnnAik, who attended yesterday's meeting in Johor, has 10 Malaysian workers; four of them have to commute to Singapore daily.
"They usually carpool to work and the higher fees mean they have to pay extra... it's quite a huge increase for them. We have to find a solution for the long term," said Mr Ow.