Expanded SST impacts essential goods, says Dr Wee

The Star

a day ago

PETALING JAYA: A detailed study of products included in the expanded sales tax list shows that many everyday products used by the M40 and B40 groups will be taxed, says MCA president Datuk Seri Dr Wee Ka Siong.
He said that it is not just luxury items like salmon and avocado.
Dr Wee highlighted that the 8% sales tax would now extend to services such as wedding dress rentals, catering, traditional medicine, postnatal massages, elderly care, and beauty treatments.
He noted that the list of taxable goods has significantly expanded while the list of tax-exempt items has been drastically reduced.
"Previously, in 2022, the list of taxable goods was relatively slim at 62 pages, whereas the list of exempt items was 282 pages thick.
"Now, under the Madani government's initiative, the Sales Tax Gazette Order PU(A) 170 list of taxable goods has expanded to 222 pages, and the list of exempt items has been reduced to just 103 pages," he said in a TikTok post on Wednesday (June 11).
The Ayer Itam MP described this as a drastic change that would directly impact the cost of living, particularly for B40 families.
He mentioned that the expanded tax list covers essential services that people rely on throughout their lives, from birth to old age.
"What's more concerning is that exemptions on some basic food items have been quietly removed," he said.
Basic items like mangoes, apples, oranges, dates, sauces, spices, canned fruits, and instant foods, which were previously tax-exempt, will now be subject to a 5% tax.
"This will lead to higher food prices in restaurants, markets, and even at home," he added.
He further mentioned that Malaysia already heavily relies on imported food, spending over RM75.6bil a year, according to data from the 2022 Statistics Department.
"In this situation, it's shocking that the government wants to add to people's burdens by taxing essential imported food," he said.
Dr Wee highlighted that the number of taxable items has increased from fewer than 1,000 to over 4,000 sub-codes, while the list of exempt items has been cut by 70%.
"This clearly shows how wide-ranging the impact of this new tax will be on people's daily lives," he said.
He also pointed out that while the government had previously claimed only luxury items like salmon and avocado would be affected, the official documents tell a different story.
"This isn't just about luxury goods. It will affect all Malaysians," he said.
Dr Wee urged the government to re-examine the expansion list and remove more essential food and services to avoid burdening the rakyat.
"Even B40 families need to get married once in their lives. Are we saying they should only wear a sarong or a 'kain pelekat' because of taxes on wedding services?" he said.
He called on the public to voice their concerns and demand fair treatment from the government.
In the tabling of Budget 2025, Prime Minister Datuk Seri Anwar Ibrahim mentioned that "premium" imported fruits, like avocados, would become more expensive due to an expanded Sales and Services Tax (SST). However, the government announced today that all imported fruits, including simple ones like apples, are now deemed non-essential and will incur a five percent sales tax.
The Finance Ministry announced on Monday (June 9) that starting July 1, it will implement an expanded sales and service tax (SST), imposing a 5%-10% sales tax on selected non-essential goods. Additionally, the service tax will now cover new sectors, including rental or leasing, construction, finance, private healthcare, education, and beauty services.