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How to Save Money with GST in Malaysia?

Time is running out. We are racing against the clock. It's the end of 2014, and for Malaysians the exciting 2015 will greet featuring GST by April Fool Day!
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In a nutshell, GST is a goods and services tax. Briefly, it means any purchase for goods and services, consumers would have to pay an additional 6% on top of the total cost. Of course, there are exemptions and exclusion scenarios that I am not the expert to preach. Find out more at official website here. The example here is just a naive illustration to describe a layman's understanding on GST. Pretending that you plan to purchase a brand new, imported handbag, it costs you RM500. With GST, one has to fork out additional 6% of total cost at which is RM30, hence final amount you have to pay with GST is RM530.

Let me give you another scenario. Being a typical Malaysian, we love hawker food from nasi lemak, char kuey teow to mee goreng. I believe their business' total revenue is unlikely to go beyond RM500K annually, hence they are unlikely to register for GST. Logically, no GST is imposed on hawker food thus the price of hawker food should remain the same. However, these hawker operators obtain goods or raw materials from retailers or wholesalers on the upstream that are registered for GST. Indirectly, hawker operators are the last guys in this chain and naively claim victimized on 'price hike'. Who do you think the smart hawker operators would transfer this cost to if not to the fellow 'loyal' consumers.


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