Small traders are finding the compliance costs for the Goods and Services Tax (GST) to be overwhelming as they are basically lean and mean operations.

It is generally accepted that businesses make between 5-10 percent of sales as their net profit, after costs.

By putting the GST threshold at RM500,000, businesses that earn between RM25,000-RM50,000 of net profits per year are brought into the GST net.

Such profits are really insufficient to finance the costs of compliance with GST which include software, hardware and staff costs - all new, additional costs.

 

The authorities should really relook at the threshold and set it at RM1.5 million, say, so that GST is not a crippling cost.