Malaysia Consumers Movement said many fresh food items were already exempted from GST before the new Pakatan Harapan (PH) government scrapped GST payment for all items.
“We think it’s a premature statement from the minister. Achieving 30% to 50% savings in less than a month is magic,” its president Darshan Singh Dhillon told FMT.
“It will be great if he could back up his statement with some data and share it with the public,” he said.
Meanwhile, Institute for Democracy and Economic Affairs (IDEAS) CEO Ali Salman also voiced doubt over the supposed price reduction due to the zero-rating of GST.
“We have said in the past that GST was not a primary factor in increasing cost of goods and services,” he said.
He added that because the perishable items were already zero-rated before, it was unlikely that their prices would be reduced with the new government’s move.
He said prices should be determined by market forces unless there was a public emergency or a situation that warranted government intervention.
Salahuddin had said the prices of fresh produce had dropped significantly after the GST was zero-rated on June 1.
He said it may take some time for prices of other goods and services to be reduced.
“Vegetable prices have dropped by 50% while prices of poultry and meat, such as beef, have also been reduced,” he said.
“I was told that you can buy poultry at RM5 or RM6 per kilogramme. Beef can be purchased at RM30 to RM33, but tenderloin is more expensive,” he said at a recent Hari Raya open house.
On June 1, the government zero-rated the 6% GST which had been introduced on April 1, 2015 by the previous Barisan Nasional (BN) administration.
The government is set to replace the GST with the sales and service tax (SST).