MIRI: The rumour that the government may have finally decided to allow telco companies to charge 6 per cent service tax on prepaid subscribers starting July 1 has created an outcry from the public at large.
Bernama national news reported yesterday that the Malaysian Communications and Multimedia Commission (MCMC) had issued a memo to all the industry players instructing them to be technically prepared for the launch on July 1.
The Borneo Post went for a street poll yesterday and found mixed views regarding the matter.
Martin Rushwaya, 24, a student from Zimbabwe who studied in one of the higher learning institute in Miri, said that the prepaid service tax would be a burden to students.
“Mobile phone communication and broadband access is an essential in our daily life, not only to get connected with friends but also family back home, which is already expensive but necessary for a person away from home,” he stressed.
Thus, he said the introduction of service tax on the prepaid services would increase his monthly expenditure on phone alone.
With the service charge at 6 per cent, a RM10 reload will now cost RM10.60 while RM15 prepaid reload cost RM15.90 and RM30 reload, RM31.80.
Martin said it was rather inconvenient as consumers were used to paying RM5, RM10 and RM50 without loose change.
Danny Kasi, 22, also agreed that having a mobile phone is an important device for connecting with people and has become a necessary part of modern living, no more a luxury. Not having a mobile phone is no longer an option.
“The cost of living has already risen tremendously in recent time, and if the 6 per cent service tax is charged on prepaid subscribers it will increase my monthly expanses while salary remains stagnant,” he added.
Moreover, he added, it will affect the low income earners more as they normally go for prepaid services.
For those who have more than one registered number for different purpose, they effectively pay 12 per cent in service tax.
Daniel Ho, 26, a postpaid subscriber believed the implementation would attract more prepaid users to change to postpaid, as it would be cheaper compared to the prepaid line.
Madu Lanyau, 18, a Celcom sales assistant said in agreement that more users would subscribe to postpaid plan as it was cheaper than prepaid usage.
“Apart from being expensive, in Sarawak users’ view, particularly those in remote area, the 6 per cent service tax is not fair as network coverage in the rural area is below par from those in the big cities, thus, it will be nonsense to pay the extra when access to the mobile service has not improved,” she sighed.
According to the report, it expected DiGi to benefit the most if the rumour was to materialise considering that it had the highest proportion (86.6 per cent) of prepaid users, compared to Maxis (74 per cent) and Celcom (77.2 per cent).
Based on its estimation, DiGi, Maxis and Celcom would enjoy earnings uplift of six per cent, four per cent and two per cent respectively.