GST Impact

Funniman said:

Many retailers reported very high sales in Jan, Feb and March before GST. Now sales is going to be very low for the next 3 months. So if you guys want to buy, sales ppl sure very happy to service you.

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Many locals, including Singaporeans, had already done their mad rush last weekend, stocking up on all essentials, groceries(except for perishables), health food, home appliances, etc.
Shopping centres were packed, and looking at their trolleys, many had shopped for the next 3 months, so expect to see slower sales everywhere at least for a month or two.

This GST thing.. frustrate.. confuse.. and made so many ppl upset..

For those Malaysian who understand cantonese..

Malaysian GST Cantonese Song

Most shoppers take impact of Malaysia's GST in their stride
PUBLISHED ON APR 2, 2015 6:00 AM

BY MELISSA LIN

Two major supermarkets in Johor Baru were noticeably less crowded yesterday, when Malaysia's 6 per cent goods and services tax (GST) kicked in.

The Straits Times had seen a lot more shoppers at the same supermarkets just the day before.

The prices of most products at the supermarkets, including shampoo, toilet rolls and cosmetics, have risen. But some items popular with Singaporean shoppers, such as milk powder, cooking oil and baby diapers, still cost the same.

At the Aeon supermarket in Bukit Indah, a pack of 10 rolls of Kleenex ultra soft toilet paper costs RM19.50 (S$7.20), up from RM17.90 the day before. The price of a 2.4kg pack of Enfagrow A+ Step 3 Original milk formula remains unchanged at RM159.99 at the same supermarket.



Staff were seen restocking the shelves and putting up new tags indicating the prices inclusive of GST yesterday afternoon.

Unlike the day before, when shoppers were busily filling their trolleys with bottles of ketchup and packs of diapers, the mood was more relaxed yesterday.

"To be honest, I don't really care much," said a 60-year-old Malaysian manager who gave his name only as Mr Weng. His shopping basket was empty as he scanned the new price tags.

"Prices of imported products were already going up before the GST kicked in because the ringgit has depreciated a lot," he said. "A crate of apples already cost RM8 to RM9 more."

Some, however, were confused by the prices as certain items were part of an in-store promotion and cheaper than what their tags indicated.

Several shoppers were seen scanning their items on machines which showed the updated prices.

Singaporean housewife Lilian Choong, 60, who stocked up on noodles, bread and instant oatmeal at Aeon, said: "I know the prices of daily essentials are supposed to be unchanged. But even if they increase, the items are still cheaper than in Singapore."

At Tesco supermarket, also in Bukit Indah, updated price tags were in place when The Straits Times visited before noon.

Receipts showed the total price before GST and the tax amount.

"The prices I've seen so far are quite reasonable," said Ms Siti Khatijah, 25, a Malaysian customer service engineer who was buying a packet of milk.

But she is "worried that some retailers will take advantage of people who don't understand the GST and simply increase prices".

[email protected]

- See more at: http://www.straitstimes.com/news/as...st-their-stride-20150402#sthash.taOPzwIy.dpuf

How Will GST Impact the Malaysia Property Market?
Apr 03, 2015

The government of Malaysia recently rolled out the new Goods & Services Tax (GST) on 1 April 2015. But many people are still in the dark as to its actual impact on the country’s property market, especially the housing sector.

To inform and help prospective real estate buyers, PropertyGuru Malaysia has compiled its effects and compared the new tax regime with the old one to give home hunters an idea of its potential effects.

Difference with Old Tax System

Based on the previous tax system (Sales Tax Act of 1972), basic building materials likes bricks, cement and floor tiles fall under the First Schedule Goods. This means they are not subject to a sales tax, while all other construction materials incur a sales tax of five percent as they fall under the Second Schedule Goods.

In comparison, the GST imposes a higher rate of 6 percent for all building materials and input services such as those provided by contractors and engineers, leading to higher cost for home builders.

Basically, the new tax regime passes the cost of Standard-Rated goods to the final buyers, while the tax of Zero-Rated goods is refunded by the government. As for Exempt-Rated items, the input tax is solely shouldered by the seller and they are entitled to refunds from the input taxes.

GST to Push Residential Prices Up

Specifically, residential properties fall under Exempt-Rated goods, meaning they are not subject to GST tax. However, prices of houses would still be affected as the construction materials used to build them are not exempted. Additionally, developers cannot get a refund for the input taxes as houses are not Zero-Rated items.

Consequently, home builders would be forced to accept a lower profit margin by absorbing a higher cost or raise the prices of their products in a bid to offset the higher cost.

According to experts, if the market is healthy and favourable, developers could pass on the cost to home buyers, while they could be willing to absorb if the residential market deteriorates. Nevertheless, profit making is still their main objective. Why would they build and sell houses if it doesn’t make any financial sense? Even market observers believe that the new tax regime could increase home prices by about five to 10 percent.

In addition, the GST could compound the woes plaguing the country’s housing market such as pricey land cost which includes conversion charges, premium cost and development charges, as well as stamp duty and quit rent. Another problem is the shortage of land in urban areas like Penang and Klang Valley, which is exacerbating the cost of houses.

Commercial & Industrial Property Sector Most Affected

Given that commercial and industrial properties are not ‘Exempt Rated’ goods but falls under ‘Standard Rated’ items, the GST will have a greater impact on these segments.

For instance, a shop sold for RM3 million will be subject to GST of RM180,000, which will be borne by the buyer. As a result, the rental yield for the investor would decrease unless he can find tenants willing to pay a higher rent.

When the same property is leased out, an additional 6 percent GST will be imposed on the tenant. For example, a RM10,000 monthly will include an additional RM600 tax.

Given this situation, landlords are advised to review their leasing agreement so that it will include relevant GST clauses. More importantly, their monthly rental mustn’t be too much as it will include a 6 percent GST. If it’s too high, they could discourage potential tenants.

For upcoming commercial and industrial properties purchased before they are ready, buyers are subjected to an additional 6 percent GST. As the price of the building is billed based on the extent of completion, the tax is similarly billed in stages.

Additionally, property investors would face higher cost as they need to set up an administrative process to collect GST when leasing or renting out commercial & industrial space.

They also need to carefully monitor their cash flow as GST must be paid when incurred or billed not when collected. Given this mandate, landlords are required to pay their taxes on time even if a tenant’s payment is late.

Conclusion

Looking ahead, a one-time increase in property prices across is expected across all sectors once the GST has been factored in by developers in light of the higher cost of construction materials and necessary building services.

But because the commercial real estate sector would suffer a heftier increase in cost as compared to the residential segment, investors may divert their capital into the latter, especially into second-hand houses. This is because not only is this sector cheaper than commercial and industrial properties as well as new houses, they are also exempt from the new tax system.

Nevertheless, prices in the secondary residential market could also trend upward to mirror the higher cost of new houses.

Farah Wahida, Editor of PropertyGuru, wrote this story. To contact her about this or other stories email [email protected]

http://www.propertyguru.com.my/prop...-will-gst-impact-the-malaysia-property-market

commercial title condo also kena 6% GST.:p

potter said:

commercial title condo also kena 6% GST.:p

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If that is the case, it will be another cooling measure to the condo sales, like ABSD in Singapore.

The cost of living has gone up with GST, especially for old folk

Published: Tuesday May 26, 2015 MYT 12:00:00 AM
Updated: Tuesday May 26, 2015 MYT 2:37:14 PM
BY CHAN LI LEEN

SENIOR citizen A. Selvarajah’s wallet is set back by at least RM100 each month ever since the implementation of the Goods and Services Tax (GST) on April 1.

It may not seem a big deal to some but for one who earns a mere RM1,000, that sum equates to a tenth of his monthly salary as a security guard.

“The cost of living has definitely gone up. It is not so much the 6% that is affecting consumers but the profiteering that goes on.

“My regular lunch of curry mutton rice has gone up to RM5.50, sometimes RM6, from RM4.50 previously while a cup of teh tarik now costs 20 sen more.

“And so, I have stopped eating mutton. I eat foods that are cheaper such as chicken or vegetables,” said Selvarajah who will soon be turning 70.

According to Selvarajah, there was no telling if consumers were being charged extra when buying groceries at the market.

“We still have to buy them at whatever price being charged, like it or not,” he said.

A factory worker prior to his retirement, Selvarajah continues to work 12 hours a day to support himself and his 62-year-old wife.

“These days, people need to work into their old age in order to survive.

“My savings in the Employees Provident Fund (EPF) have been used up long ago and while my children are willing to take care of us, they have their own families to support as well.

“I strongly believe our Government should do more to help the elderly, such as giving out monthly welfare aid to senior citizens just like in other countries,” he said.

Heart patient Pauline Ong has undergone four angioplasty procedures and survives on a cocktail of medication daily.

“Already, I was paying an arm and a leg for my medication, some of which I have switched to generic form because they cost less.

“Needless to say, my monthly expenditure has gone up significantly with the GST mainly because my heart medications are not tax exempted.

“It is very inconsiderate of the Government to impose a tax on the medication of those with critical illnesses.

“Why punish us for being sick? No one chooses to be sick or to be placed on long-term medication.

“If you can give a personal tax deduction for medical treatment of critical illnesses, why impose GST on such medication?” she asked.

Ong, 64, is now bracing herself for further price increases.

“I am sure drug companies will inevitably increase their prices because of the weakening ringgit.

“With our currency getting weaker and the cost of living geting higher, life is going to be hard, especially for the elderly.

“Next, we are going to see more elderly people begging and living on the streets,” said the single mother, who survives on pocket money from her children.

Anning Old Folks Home adviser Ho You Meng said the cost of running an old folks home would definitely go up with the GST.

“Already, we are getting less donations in cash and in kind because people are struggling to get by.

“This means that we will have to fork out our own money,” he said.

Ho said the home, which has 48 residents, required a lot of adult diapers.

“Eight of our residents rely on adult disposable diapers because they are immobile.

“Each uses six diapers a day, which is a total of 48 diapers,” he said.

Ho, however, said it was premature to tell how badly the home’s operations would be affected by the GST.

http://www.thestar.com.my/Metro/Com...has-gone-up-with-GST-especially-for-old-folk/

It looks like GST implementation and weaker RM have increased prices by 10-20% across the board

FHBH12 said:

It looks like GST implementation and weaker RM have increased prices by 10-20% across the board

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Unfortuantely... not for properties at Iskandar... :*: