GST 7%, included into property buying too?
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 May 21 2013, 10:43 PM
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#1
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Senior Member
560 posts Joined: Sep 2009 
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Even if not charge 7% at every level, cost of living will still go up.
The fisherman, the middle man, the fish monger, and chef each have to pay more for goods that they and family use personally (motor, car, appliances, medicine, daily necessities, etc., because of GST) in their daily lives. So each will add cost to the fish indirectly and the end user has to pay more on top of the proposed GST. Does that make sense? |
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May 21 2013, 10:59 PM
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#2
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560 posts Joined: Sep 2009
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The govt projects that they will increase annual revenue by RM27billion via GST. That means on average, every man, woman and child in this country contribute almost RM1000 each per year. Of course some contribute more, but this is on average. Is this a reasonable estimate?
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May 21 2013, 11:06 PM
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#3
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QUOTE(The Jedi @ May 21 2013, 10:59 PM) Your understanding of GST is flawed. GST is incurred at each stage of value chain and it is pass through tax and in general not expenses or cost item to the business. The final end stage of value chain, the end customer, is liable to pay the GST. This is the fundamental concept of GST and it has been apply in 150 countries. In Asia, only MSIA, HK and Brunei yet to implement GST. Ok point taken, what I meant is not expense or cost to business. I mean every person along the supply chain will be impacted personally by increase in cost of living. And they in turn will charge more to be able to live normally. Isn't that a reasonable assumption? |
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May 21 2013, 11:21 PM
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#4
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560 posts Joined: Sep 2009
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QUOTE(The Jedi @ May 21 2013, 11:11 PM) It's difficult to explain GST concept with pure words and best use diagram to explain. Suggest you google GST and get better understanding. I used to think like you before I understand the concept... This is a clear example where the govt needs to spend considerable time to educate and explain GST to the public. GST will doom to fail if communication is inadequate What I mention is not about the mechanism of GST.Can we agree everyone on average has to pay more for goods and services? If Yes, than there will be this vicious cycle and will cost everything to go up. There is also the Festive Season Barang Naik syndrome - invented by myself  People will use any excuse to raise prices. |
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May 21 2013, 11:26 PM
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#5
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560 posts Joined: Sep 2009
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QUOTE(skcJVN @ May 21 2013, 11:13 PM) HaHa ,aku janji BR1M increase to rm 1000.00 next year - that is where the money come ! All the family members contribute 1K , but only some family get 1K - good idea . Lol  |
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May 22 2013, 06:12 PM
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#6
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560 posts Joined: Sep 2009
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QUOTE(EddyLB @ May 22 2013, 05:35 PM) Let's use numbers, maybe easier to understand Yes, and there is bound to be other effects.Supplier A sells stuff to Supplier B --> price RM100 + GST RM4 = RM104. Supplier A remits RM4 GST to Customs Supplier B re-sells the same stuff to Supplier C --> RM110 + GST RM4.40 = RM114.40. Supplier B claim RM4 from Customs. So, nett pay to Customs is RM0.40 Supplier C re-sells the same stuff to Consumer --> RM120 + GST RM4.80 = RM124.80. Supplier C claim RM4.40 from Customs. So, nett pay to Customs is RM0.40 Total GST collected by Customs is RM4.00 + RM0.40 + RM0.40. Which is the eventual selling price RM120 x 4% = RM4.80. Therefore, it is not "layer on layer". The final consumer actually pay the GST. Business have no reasons to hike price. But in actual fact, some business will take opportunity to profit I think  Supplier A will also pay higher price for necessities that he and his family uses personally. After all Supplier A is also a consumer, right? So to make ends meet, he will raise the price by a few RM as well. The same with supplier B and C and so on. This is the indirect consequence of GST. And like you said, businesses will take the opportunity to raise prices for no good reason. |
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