Scrap tyre tax: Dealers

Lim (seated right) with other association members. Photo: Mohd Alif Noni
By Alverdtekoster Anyap & Sarah Hafizah Chandra

KUCHING: Sarawak Tyre Dealers and Retreaders Association has appealed to the state government to refrain from implementing the state sales tax (SST) on tyres in order not to burden the people.

The association’s president, Lim Kong Hong said that imposing the tax on tyres would be unfair given the current economic situation and the rise in the prices of raw materials to make the tyres. 

“The raw materials have increased to double digits since the end of last year.

“The shipping charges for importing tyres have also more than doubled since last year as well,” he pointed out during a press conference at the association’s headquarters near Jalan Ang Cheng Ho today.

He said that the government should not add additional costs to businesses and consumers during the Covid-19 pandemic.

“We are the largest state in Malaysia with a vast land size and longer distance to travel, especially for those who are in the rural areas. 

“The imposition of the 2.5 percent SST will definitely amplify inflation and burden the people,” he added. 

Lim also said that the prices of tyres would increase by 2.5 percent if the SST was implemented

At the end of last year, the state government proposed to impose a 2.5 percent SST on tyres and the directive for the imposition of the tax effective on Jan 4 was also issued to relevant stakeholders.

“Previously, the state government proposed to impose a five percent SST on tyres from Jan 1 but it was delayed because of strong objections from other associations and business sectors.

 “The Sarawak Tyre Dealers Association, Kuching Bicycle & Motor Traders Association, the Sarawak Bus Transport Co Association, Sarawak Lorries Transport Association and others strongly objected to the proposed tax as the Covid-19 pandemic caused an economic recession,” Lim said.

Across the country, tyres are subjected to a five percent federal sales tax (FST) and those that are imported from outside the Asean region have an additional five percent import duty imposed.

 “The state government should not impose SST on tyres and the state’s autonomy on imposing the tax should not be exercised because it burdens the people. Sarawak is the only state in Malaysia that is imposing SST on tyres,” added Lim.