Business

Service charge not a government tax

Maslan says again that consumers can refuse to pay the service charge which is not a government tax.

Maslan says again that consumers can refuse to pay the service charge which is not a government tax.

Nikita Nawawi
Written by Nikita Nawawi

KUALA LUMPUR – March 24, 2015: The Domestic Trade, Cooperatives and Consumerism Ministry (KPDNKK) may be asked to tell the food and beverage industry to amend the term service charge to rid of any ambiguity.

This is to categorically make clear to consumers that the charge has nothing to do with the government and that the money does not go to the government.

According to Deputy Finance Minister Datuk Ahmad Maslan, people must be able to distinguish between service charge and service tax to avoid confusion.

“Service charge is different from Sales and Services Tax (SST) and Goods and Services Tax (GST) as it is a form of tip given by customers,” said Maslan.

Maslan however made clear today that the implementation of the GST from next month will not affect whatever charges hotels and restaurants impose.

“Currently the service tax is 6 per cent and from April this tax will be changed to the GST. So nothing changes there.

“It is up to the customer if he doesn’t want to pay the service charge but not the GST,” said Maslan.

Maslan today hosted a luncheon dialogue on the GST and other current issues.

He also revealed that companies may get a special refund of the sales tax on goods held in hand.

Those who wish to claim are given six months to do so through the GST online portalTaxpayer Access Portal starting April 1.

For refunds of below RM10,000, companies will have to submit an audit certificate from a certified accountant while for claims above that they need to submit an audit certificate from a licensed auditor.

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About the author

Nikita Nawawi

Nikita Nawawi

Nikita Nawawi is an up-and-coming writer who started his involvement in the media industry serving established local English daily, before joining The Mole in October 2014 as journalist.