Prices of goods should not be linked to SST: Customs DG

SEPANG: Prices of goods, regardless if there is an increase or decrease, should not be linked to the Sales and Services Tax (SST), according to Customs director-general Datuk Seri Subromaniam Tholasy.
He said the recently implemented tax would only make up a small component in the determination of prices of items, and as such, any impact on prices would be minimal.
Subromaniam said prices are instead largely influenced by external factors, including the supply and demand of the product.
"Prices are normally determined by other factors. Supply and demand, exchange rate, seasonal factors and life cycle of an item are among them.
"Tax, on the other hand, is only a very, very small component in price determination. So don't associate SST with prices of goods," he told reporters after updating the media on the Customs' success at crippling an alcohol processing syndicate, here today.
Subromaniam was asked to comment on whether the prices of goods have reduced since SST was implemented on Sept 1, as promised by the Pakatan Harapan (PH) government.
SST, which replaced the Goods and Services Tax (GST), is a single-stage tax system imposed only on manufacturers at a rate of 10%, as opposed to the 6% at every stage under GST. Services are taxed at 6% under SST.
Commenting on the month since SST was implemented, Subromaniam said the implementation was smooth-sailing without any major hiccups.
"What surprised us most is that most of the companies actually cooperated well with us. Also, many did not have much problem as they were already registered for SST before GST was implemented in 2015," he added.