KUALA LUMPUR (July 18): Ambank Group Research said the outcome from the Sales and Services Tax (SST) would be mixed as it depends on the combination of the SST being slapped on the goods and services.

In a note today, AmBank Group chief economist and head of research Dr Anthony Dass said the reintroduction of the sales tax between 5% and 10% on selected manufactured and imported products and 6% services tax on selected services have raised the question of whether the move will raise prices.

He said under the Goods and Services Tax (GST), all products and services are subject to 6% tax.

Dass said to recap, the 6% GST drew strong criticism with public opinion citing it has caused overall prices to rise, thus hurting the people’s living cost.

“Businesses faced difficulties as reimbursement can be declined with a RM500,000 minimum requirement in annual sales before they can make a claim. Also, middle men were taking advantage by raising prices.

“We believe the outcome from the SST would be mixed as it depends on the combination of the SST being slapped on the goods and services.

“Thus, different products and services will be affected differently, suggesting households may pay marginally higher for some products and services or the same for some items,” he said.

Dass thus explained that on the whole, there are possibilities for the overall tax burden to be lower, compared to the GST days.

“Assuming the SST coverage does not impact the goods and services of the lower and middle-income group, their disposable income will improve, which in turn will lift their spending power,” he said.