The Finance Ministry has raised the threshold on eateries that will be charged the sales and service tax (SST) from September 1 from RM500,000 under the GST to RM1.5 million.
The Sales and Service Tax (SST) threshold for eateries will be increased to RM1.5 million, says Finance Minister Lim Guan Eng.
This means only eateries that make RM1.5 million and above annually will be subject to SST.
“We received feedback from owners of coffee shops and nasi kandar restaurants, (and) they have asked for the threshold to be increased from RM500,000 (under the GST).
“Some have asked for it to be increased to RM3 million annually, which it is a bit too much.
“But I have agreed to take this into consideration, so we are increasing the threshold to RM1.5 million. But this will be final.
“So only if your annual turnover is above RM1.5 million will you be subject to SST,” said Lim at a media briefing on SST at the Treasury building here Thursday (Aug 30).
Lim said he hoped the increase in the threshold would prevent restaurant owners from increasing prices.
“But we urge consumers to become our eyes and ears. If they find that eateries have increased their prices due to SST, they can complain to the Domestic Trade and Consumer Affairs Ministry,” he said.
Lim said the government’s approach with the SST was to ensure the people’s well-being was taken care of.
“We want to ensure that the people are not burdened. The government views this as more important than collecting revenue from taxes.
“What is the point of having nice-looking figures, if the people are suffering?” said Lim.
The SST, which replaces the 6% goods and services tax (GST) introduced by the previous government in 2015, comes into effect on Sept 1.
It will see selected items subject to a 5% or 10% tax while services will be subject to a 6% tax. The government has said that with the SST, more items will be tax-exempt compared to the GST.
Lim said with the new threshold, prices should not increase except for big businesses with a turnover of RM1.5 million.
“Even construction materials are exempt from the SST,” he added. “We hope no parties will increase prices for this when it is exempt.”
He said there would also be price increases which the government would need to study.
“We will work on it from time to time,” he said. “Give us feedback. We will listen.”