Latest news with #MalaysiaRetailersAssociation
The Star
3 hours ago
- Business
- The Star
Business groups urge government to defer and reduce SST hike
KUALA LUMPUR: Six major business associations have strongly urged the government to defer the expansion of the Sales and Service Tax (SST), particularly the 8% levy on commercial rental and leasing services set to take effect on Tuesday (July 1). In a joint statement, the SME Association of Malaysia, Malaysia Retail Chain Association, Malaysia Retailers Association, Federation of Malaysia Business Associations, Bumiputra Retailers Organization Malaysia, and Malaysia Shopping Malls Association warned that the tax could severely cripple businesses already facing escalating costs. They described the timing and scale of the new tax as "gravely misguided" and warned it would trigger inflation, shrink consumer spending, discourage investment, and threaten the survival of many small and medium enterprises (SMEs). The associations added in a statement on Tuesday (June 17) that businesses are already under pressure from higher minimum wages, diesel and electricity prices, reduced subsidies, mandatory e-invoicing, foreign worker EPF costs, and a weakening ringgit. "SST is a regressive tax without input credits, unlike the former GST system, and it is inefficient, anti-business, and harmful to growth and investment." They proposed the government consider reinstating GST with reforms instead of expanding the current SST. Among their five key considerations for the government are to firstly postpone the SST expansion until economic recovery is stronger. They then added that the proposed 8% SST rate on rentals is reduced and micro and small enterprises be exempted along with targeted relief being offered to critical sectors. 'Engage in consultation before implementing tax reforms,' they added. The associations said they were not opposed to tax reforms, but stressed the need for fair, inclusive policies that do not endanger business sustainability or economic recovery. "The business community stands ready to support national fiscal goals, but such goals must be achieved through fair, practical, and inclusive policymaking. "We call on the government to act decisively, responsibly, and in the national interest before irreversible damage is done to the economic ecosystem that supports jobs, innovation, and long-term growth," added the associations.
The Sun
15 hours ago
- Business
- The Sun
Malaysia Retailers Association seeks SST waiver on commercial rentals to protect businesses, consumers
PETALING JAYA: The Malaysia Retailers Association (MRA) has urged the Ministry of Finance (Mof) to waive the planned 8% Sales and Service Tax (SST) on commercial rental and leasing services, scheduled to take effect on July 1. Retail businesses across the country are already under immense pressure from a succession of cost increases, including but not limited to the minimum wage increase to RM1,700; electricity tariff hikes; stamp duty on employment contracts; fuel subsidy rationalisation; the SST rate hike from 6% to 8%; and the 10% sales tax on low-value imported goods, MRA said in a statement, adding that these are just a few examples of rising fixed operational costs. 'The full scope of burdens faced by retail businesses is much broader, but even these alone are already impacting business sustainability and bottom lines,' it added. MRA said the additional 8% SST on commercial rentals – introduced without any consultation or engagement with the retail sector – adds further pressure. 'Rental is among the largest fixed costs for many businesses and this tax will push operating expenses even higher. It is unrealistic to expect retail businesses to absorb the full impact and many may have no choice but to pass these costs on to consumers – contributing to inflation and intensifying the rakyat's cost-of-living burden,' the association said. Compounding these challenges, it said, is the growing uncertainty in the global economy, especially in light of the recent escalation in geopolitical tensions between Iran and Israel. This conflict has already begun affecting regional confidence, global commodity prices, and trade flows – making it an especially inappropriate time to introduce new tax burdens. In light of these concerns, MRA strongly urged that a complete waiver of SST on commercial rental and leasing services or at minimum, defer implementation sine die, until macroeconomic and geopolitical conditions stabilise. If implemented, the association urged that the SST should be shared fairly between landlords and tenants, rather than passed entirely to retail businesses. It also urged that service charges and shared area fees should be excluded from the SST scope; the SST exemption threshold should be raised to RM2 million in annual sales to safeguard small and independent retail businesses; defer the SST on rentals until after Visit Malaysia Year 2026 to preserve industry stability and support tourism-linked growth and introduce the SST gradually, starting at 3% and increasing progressively to 8% over five years. MRA said that retail businesses play a vital role in domestic economic growth and employment and thus it is critical that policies impacting this sector are implemented with transparency, fairness and proper stakeholder engagement. MRA said it welcomes further discussion with MoF to find a balanced and sustainable approach that supports both businesses and consumers.
New Straits Times
a day ago
- Business
- New Straits Times
Retailers urge government to scrap SST on commercial rentals
KUALA LUMPUR: The Malaysia Retailers Association (MRA) has urged the Finance Ministry to revoke the planned eight per cent Sales and Service Tax (SST) on commercial rental and leasing services. Its president Datuk Andrew Lim Tatt Keong said the additional levy could strain business sustainability and fuel consumer price increases. He said retailers are already grappling with a raft of cost pressures, including the minimum wage hike to RM1,700, rising electricity tariffs, stamp duties on employment contracts, fuel subsidy rationalisation, and the earlier SST rate increase from six to eight per cent. "These are just a few examples of rising fixed operational costs. Even these alone are already impacting business sustainability and bottom lines," he said in a statement today. Lim added that the retail sector was not consulted prior to the decision to impose SST on commercial rentals, despite rental being among the largest fixed costs for many businesses. "It is unrealistic to expect retail businesses to absorb the full impact, and many may have no choice but to pass these costs on to consumers, contributing to inflation and intensifying the rakyat's cost-of-living burden," he said. He also pointed to growing global uncertainties, particularly the recent conflict escalation between Iran and Israel, as further reason to reconsider the timing of the tax. In response, the MRA proposed several measures. These include a complete waiver of the SST on commercial rentals or, at the very least, a deferral until both global and domestic conditions are more stable. The association also called for the tax to be fairly shared between landlords and tenants, rather than borne entirely by retailers. It urged that service charges and shared area fees be excluded from the tax scope and that the SST exemption threshold be raised to RM2 million in annual sales to protect small and independent retailers. Additionally, the MRA suggested delaying implementation until after Visit Malaysia Year 2026 and introducing the tax gradually, starting at three per cent and increasing progressively to eight per cent over five years. Lim said the retail sector plays a vital role in driving domestic economic growth and employment, and stressed that policies affecting the sector must be implemented with transparency, fairness and proper stakeholder engagement. He added the MRA is open to further discussions with the Finance Ministry to find a balanced and sustainable approach that supports both businesses and consumers.
