Hotels, Restaurant: No Service Charge !

Customs GST Director Datuk Subromaniam Tholasy

Hotels and restaurants are not allowed to charge Service Charge unless they have a Collective Agreement (CA) with their employees, Domestic Trade, Cooperatives and Consumerism Ministry (KPDNKK) secretary-general Datuk Seri Alias Ahmad said.

Restaurants that imposes a Service Charge will need to display a notice, he added.

"After analyzing the complaints received about Service Charge, the Ministry has decided that hotels and restaurants will not be allowed to charge Service Charge unless there is a CA between the employers and employees beside a notice on display if they impose a Service Charge," he told media.

Consumers can report premises that fail to abide to this to KPDNKK for further investigation.

"The analysis was done by Finance Ministry, Human Resource Ministry and KPDNKK as there is no regulatory on the implementation of GST. Hotels and restaurants that do not abide by this can be charged under the Price Control and Anti Profiteering Act, Trade Description Act (Akta Perihal Dagangan) or Consumer Protection Act," he added.

This new enforcement will be in place until there is a new policy introduced by the government.

Alias also told that thus far there have been 2,494 complaints made about GST from April 1-5 to KPDNKK.

"The complaints received are on GST imposed on prepaid top-up cards, price hikes by retailers where the most complaints were made about baby milk powder and baby diapers.There were also complaints made about receipt without GST ID number and the imposing of Service Charge.," he said.

Meanwhile, Customs GST Director Datuk Subromaniam Tholasy said 40% of the complaints made by the public were about the tax invoice the retailers give out as they do not adhere to the GST Regulations 2014 where there is no GST registration number, the GST registration number does not have 12 digits, handwritten receipts and the usage of other languages instead of Bahasa Malaysia or English in the receipts.

"Some of the retailers are not using the Point of Sales (POS) system or cash registry that has been approved for the implementation of GST. There are also complaints received that consumers were charged a cumulative GST instead of only on selected items," Subromaniam said.

All this if found guilty can be fined not exceeding RM 30,000 or face imprisonment not more than 2 years or both.

Subromaniam said consumers need to know their rights and act on it to avoid paying for GST on items or services that have been exempted from it.
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