As we move toward April 1, the day of implementation of the goods and services tax (GST), the Customs Department should allow another six months for small and medium enterprises (SMEs) to register.

This is because there is still some confusion.

We also urge the government to increase the GST threshold to at least RM1 million turnover a year.

This has thus far fallen on deaf ears.

The impact of GST is grave on the SMEs, who as it is rarely receive assistance from the government.

The government should note that the SMEs are actually helping government collect tax at their own expense. The government should not further burden the SME owners who are not familiar with the new tax system.

 

The government must know that small business owners who do not employ accountants for their book-keeping now have to not only handle tax collection in-house, and have to purchase software to calculate GST.

The cost may be minuscule to bigger companies but definitely a huge cost increase to small business owners having only about RM500,000 turnover annually.

 

Hence, it is sad to see the Customs Department start to take action and fine these business holders who do not know better.

We must know that RM15,000 may just be the turnover of small businesses in about seven to 10 days and not even their net profit.

There should not be a compound for failure to register, before the GST is implemented. In fact, a six month warning period should be granted after April 1, to ensure business owners understand how to operate under the new tax regime.

 

The government should respect the will of people who are paying the tax.

Finance Minister Najib Abdul Razak should heed the urging by at least giving another six months for business entities to register without being fined.

Furthermore, Najib should immediately increase the GST threshold to RM1 million turnover a year.

WONG SHU QI is Johor DAP policy director and Senai state assemblyperson.