Get rid of fuel tax on industries, PKR tells Putrajaya

The airline industry is among those on which Putrajaya had imposed a levy. – The Malaysian Insider file pic, April 1, 2015. 

Putrajaya should do away with the fuel tax imposed on industries and commercial entities, PKR said today, noting that the government made RM158 million in the first two months of this year from the levy.

PKR secretary-general Rafizi Ramli said in view of that, Putrajaya could not blame traders for not reducing the prices of their goods as their business costs would have also gone up with the sales tax.

The Pandan MP was commenting on a written reply from Finance Minister Datuk Seri Najib Razak, who confirmed that the government had collected RM158 million in January and February this year from the tax.

This tax, Najib said, was imposed on certain industries such as airlines, construction, mining, manufacturing and logging.

"This answer confirms that part of the reason why prices do not go down is because manufacturers and industries have been taxed since January 2015," Rafizi told reporters at the Parliament lobby today.

"I predict that the tax collections for 2015 can reach RM900 million when just the first two months could generate RM158 million."

In January, Rafizi had revealed a circular from the Finance Ministry leaked to him by an unidentified source showed that it was Najib who made fuel more expensive for industrial and commercial consumers.

He said, according to the circular, a sales tax had been imposed on petrol and diesel for industries and commercial entities, which use fuel in large quantities for their businesses, beginning January 1 this year.

"The tax is 40 sen a litre for diesel and B5 diesel, and 58.62 sen a litre for RON95 and RON97," he had said then.

Rafizi said the industries and commercial consumers were also not allowed to buy fuel from petrol stations like common consumers, but had to go directly to petrol companies like Petronas, Shell, Petron and others to buy the sales-tax imposed fuel in bulk.

This was why consumer goods were not cheaper despite with lower fuel prices, he said today, noting that the issue of high prices had even turned racial such as comments by minister Datuk Seri Ismail Sabri Yaakob's Facebook comment on Chinese traders.

Ismail Sabri had courted controversy after he wrote in a Facebook post that Malay consumers had a role in helping Putrajaya fight profiteers by using their collective power to lower the price of goods.

However, Rafizi, who is also PKR vice-president, said the people were not aware that petrol and diesel prices used by industries and businesses have not decreased because they have been taxed additionally by the government.

"With the burdensome GST (goods and services tax) that is starting today, I urge the government to do away with the petrol and diesel tax used in industries and businesses so that their costs do not continue to go up.

"Quietly implementing this tax on businesses and blaming them for not reducing their prices is dishonest and burdensome to the people.”

- TMI