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Finance Minister Blasts Telcos For Deducting 6% SST On Prepaid Cards

"You pay RM10 and you get back RM10."

Cover image via Marcus Pheong/Malay Mail

Finance Minister Lim Guan Eng has come down hard on telecommunication companies for making "lives difficult" of ordinary Malaysians by deducting 6% SST on mobile prepaid cards

According to Lim Guan Eng, mobile prepaid reload cards are not subjected to the sales and service tax (SST), which came into force on Saturday, 1 September.

He said that his ministry will be meeting with telcos to sort the matter out.

Malaysians have been getting slightly less credit for all reloads or top-ups since yesterday. For example, an RM10 top-up only gave them RM9.43 of credit. Following which, consumers complained that credit value was being deducted.

He said telcos must ensure that customers were given the full amount when they topped-up their mobile prepaid phones, adding that the 6% SST should not be passed on to customers

"We have issued a directive and we want all telecommunication companies to abide by it. The six per cent SST should not be passed on to customers," he was quoted as saying by NST Online in a report published on 1 September.

Image via NST Online

The Finance Minister reiterated it today, adding that what the telcos have been saying that prepaid cards are subjected to SST is wrong

"There is no need for double tax cuts. If you use prepaid, you pay RM10 and you get back RM10. There is no such thing as (SST) deductions.

"Why are they (telcos) going to make lives difficult?

"Do they have no other work to do? We are meeting the telco companies. This one is no problem. Prepaid cards are the same (no SST)," Malaysiakini quoted him as saying.

Meanwhile, telcos have tried to cushion the blow by offering consumers extra freebies in the form of free minutes and free data

Hotlink is giving free minutes depending on your top up amount.

Digi is giving free data, which is only valid for one day.

Xpax is also giving free voice calls, which is valid for only 24 hours.

U Mobile is giving 10% extra credit for U Mobile to U Mobile calls and it is valid for a day.

You can check out the full list of freebies here.

Image via soyacincau

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