PKR vice-president Rafizi Ramli claimed that the prices of goods are not decreasing because manufacturers and companies have been slapped with a new sales tax.

 

The tax is imposed on petrol and diesel purchased by the industrial and commercial sectors starting Jan 1, he said, citing a purportedly leaked circular from the Treasury.

 

“(Prime Minister) Najib Abdul Razak’s administration is acting irresponsibly by quietly imposing a tax on industry to increase revenue with the hope that the people would vent their frustrations towards industries and traders, instead of the government.

 

“In the meantime, the government collects hundreds of millions in taxes from traders and the public each month since the oil price slump began,” he said in a statement today.

 

Rafizi said the reference number of the circular is SR(8.09)102/21-1Vol.58(38), but he is not revealing the letter as per his informant’s request.

 

He added that there are is a “silent campaign” on social media blaming Chinese Malaysian traders for not lowering prices despite the lower fuel prices, since the tax is not publicly known.

 

Since December last year, the government has scrapped fuel subsidies for RON95 petrol and diesel, and placed the retail price on a managed float, and reviewed monthly.

 

For January, the price of fuel at the pump is RM1.91 per litre for RON95, RM2.11 per litre for RON97, and RM1.93 per litre for diesel.

 

‘Manufacturers, industries taxed twice’

 

However, Rafizi said factories are not allowed to use this fuel for industrial purposes but must instead purchase it in bulk directly from oil companies.

 

Citing the circular, Rafizi claimed that the sales tax imposed is 58.62 sen per litre for RON95 and RON97 petrol, and 40 sen per litre for diesel and B5 diesel, minus a discount to be decided by the Finance Ministry each month.

 

The tax is imposed on top of the retail prices of the fuel purchased.

 

For January, the discount is 22.72 sen per litre for RON95, 6.08 sen per litre for RON97, 9.4 sen per litre for diesel, and 12.89 sen per litre for B5 diesel, he said.

 

This means that factories would have to pay RM2.269 per litre of RON95 (35.9 sen tax), RM2.635 per litre of RON97 (52.5 sen tax) and RM2.236 per litre of diesel (30.6 sen tax).

 

“This means manufacturers and industries are being taxed twice by the government, which is through the sales tax announced in the monthly circulars, and a hidden petrol and diesel tax caused by differences between market prices and the price set by the government,” Rafizi said.

 

The Pandan MP urged the government to drop the taxes so that members of the public can benefit from the falling global oil prices.