KUALA LUMPUR (Dec 28): Mobile phone prepaid users will begin receiving a rebate for goods and services tax (GST) charges on prepaid reloads this Friday (Jan 1, 2016).
In a statement, the Communications and Multimedia Consumer Forum of Malaysia (CFM) said the rebates will be offered until Dec 31, 2016, in line with Prime Minister Datuk Seri Najib Razak's announcement during the tabling of Budget 2016 on Oct 23.
"This means a customer who tops up RM10 will initially get an airtime of RM9.43 as the 6% GST will be deducted from the top-up," the statement read.
"The customer will receive a rebate of RM0.57 within 24 hours," the statement added.
CFM said only Malaysian nationals qualify for the rebates. The GST paid by the customers will be collected and remitted to the Royal Malaysian Customs Department, in accordance with the GST Act 2014 and guidelines, the statement read.
"Telcos (Telecommunication companies) have worked hard to ensure that there will be a smooth transition so that customers will have a seamless experience when topping up," the statement read.
"Telcos have also been continuously investing in modernising the country's network to ensure quality customer experience," it added.
The rebate follows public outcry after mobile phone prepaid reloads were subjected to GST charges, despite an assurance from Deputy Finance Minister Datuk Ahmad Maslan that there would be no changes to the prices of reload coupons, as the 6% GST would merely replace the 6% sales and services tax.
Previously, telcos absorbed the 6% service charge imposed on prepaid mobile users.
The Malaysian Communications and Multimedia Commission and CFM had later clarified that consumers would have to bear the GST cost on prepaid reloads as communication services were not exempted from the tax nor zero-rated.
Under Budget 2016, Najib then announced that rebates for GST will be offered to prepaid mobile phone users and that the government was willing to "let go" of some earnings from the broad-based consumption tax to lighten the burden of consumers.