Service tax imposed by telcos ‘unfair’ and akin to robbing the poor


KUCHING: Dewan Rakyat Deputy Speaker  Datuk Wan Junaidi Tuanku Jaafar feels for the people who will have  to pay six per cent service tax every time they buy prepaid reloads or prepaid starter-SIM packs, effective Sept 15.

Datuk Wan Junaidi Tuanku Jaafar

Describing the tax imposed by all the telecommunication companies as “unfair” and akin to robbing the poor, Wan Junaidi said it would hit people in the low income group and students hard.

He said that he would be raising the people’s predicament with Prime Minister Datuk Seri Najib Tun Razak during the Parliamentary pre-council meeting on Oct 3.

“During that meeting I will have the best opportunity to speak my mind because as Deputy Speaker I do not have the chance to speak like other MPs when Parliament is in session,” he told thesundaypost yesterday.

Wan Junaidi, who is also Santubong MP, said he believed that the service tax would turn owners of this telcos into “instant billionaires”.

“No doubt some companies have invested hundreds of millions of ringgit into telecommunication infrastructure but the returns have been more than quadrupled in recent years.

“The number of mobile phone users has increased 10 folds in recent years, and continue to increase due to technological advancements such as SMS, MMS, emails and Internet access.

“The thing is that many people in the low income group, students and junior employees in various sectors are prepaid users. So they will be seriously affected by this service tax. It is unfair and opportunistic for the telecommunication companies to do that. I urge the government, particularly the Ministry in charge, to tell these companies to do a little public social contribution. Don’t rob the poor to give it to the rich.”

Meanwhile, state PKR vice chairman See Chee How said the government was “not sincere” when it stated that it wanted to ease the burden of the people.

If the government was indeed sincere, it would have instructed the telcos to continue absorbing the six per cent service tax, he argued.

“The monopoly enjoyed by certain corporations is certainly detrimental to the people. Celcom, Maxis and Digi have reported first half year profits of RM1.4 billion, RM1.09 billion and RM568 million respectively. There is no reason to transfer the service tax (or charge) to prepaid phone users.

“I think the transfer of service tax by telcos is unwise and unreasonable,” said See, who is also Batu Lintang assemblyman.

See added that the federal government’s response to the telcos’ announcement on the service tax were mere moves to “evade responsibility” because the monies were in fact collected by the government.