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Ministry no authority to force Telcos to absorb GST

Ministry no authority to force Telcos to absorb GST
Datuk Seri Ahmad Shabery Cheek told the Dewan Rakyat there was no provision under the law to enable the ministry to take action against companies which did not absorb the GST.
KUALA LUMPUR: The Communication and Multimedia Ministry (KKMM) has no authority to force telecommunication companies to absorb the Goods and Services Tax (GST) in the telephone prepaid card service.

Its Minister Datuk Seri Ahmad Shabery Cheek told the Dewan Rakyat there was no provision under the law to enable the ministry to take action against companies which did not absorb the GST.
"It is possible if there is a law forcing (them) to absorb GST, but it is not in my capacity to force any company to absorb the GST," he said when winding up the debate over the motion on the 11th Malaysia Plan (11MP), here, Monday.

Several members of Parliament including Sim Tze Tzin (PKR-Bayan Baru); Dr Lee Boon Chye (PKR-Gopeng) and Datuk Seri Noh Omar (BN-Tanjong Karang), prior to this, urged the ministry to use its power to ensure telecommunication companies absorbed the GST to ease the burden of consumers.
Refuting the allegation the ministry was more in favour of the telecommunication companies compared to the people in the issue, Ahmad Shabery said the ministry could only do what was within its power including ensuring the people had the best service in line with the current technological development.

"I can force the telecommunication company to invest in telecommunication towers to ensure every citizen get the facility, that is under the ministry's jurisdiction..(if) they cannot, we (ministry) can penalise.

"This is to ensure a good service. What is the use of us buying cheap (prepaid) card if the service is no good," he said.

In the meantime, Ahmad Shabery said the government had no plans to control the price of the telecommunication service because the sector was among those industries which always offered competitive prices.

"One day calls may be free, short messaging service can be free because there is the WhatsApp application, they (telecommunication companies) are forced to compete, but to impose a floor price may not be wise currently because they may be able to offer cheaper rates," he said.

In addition, Ahmad Shabery said the freedom of the press was not an important foundation towards becoming a developed nation.

He said an overly free media could invite untoward action which could adversely affect national harmony.

"Do we want to be a nation with the press freedom of Sweden, Denmark and France. In our fervour for press freedom, is it okay to insult the prophet, draw cartoons? If that is the aspiration, then we (government) disagree," he said.