A brighter Hari Raya without GST

Fashion boutique owners who sell Muslim wear and those celebrating Hari Raya welcome the zero-rating of the goods and services tax.

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MC Vogue boutique supervisor Noorfarahain Ibrahim says sales are gradually recovering after a bad 2017.

PETALING JAYA: With the goods and services tax (GST) being zero-rated since June 1, boutiques selling Muslim wear have been experiencing a boost in business.

They welcome this as the Hari Raya festive season is the best time for business.

Speaking to FMT, MC Vogue boutique supervisor Noorfarahain Ibrahim said sales were gradually recovering after a bad 2017.

“The zero-rating of GST came just in time for Hari Raya, I feel. Since the tax kicked in in 2015, our business hasn’t been at its best.

“In 2015, it still hadn’t quite hit consumers, so people were still shopping like usual. Last year was the worst. Earlier this year too, sales didn’t pick up.

“But since they announced the zero-rated GST, our sales have improved 30% to 40%.”

Noorfarahain, who has been with the boutique for the past four years, said sales of boutiques nationwide had improved since GST was zero-rated.

“The moment they zero-rated GST, our sales in the first week have been able to cover up whatever we lost in the past three months.

“We were quite worried that because of GST, we would not be able to hit our sales target.

“Up until today, we’ve managed to roll out about 40% of our stocks and hope to sell everything by the end of this month.”

Being in the retail business, Noorfarahain said it was a good sign for the economy when people were able to spend on clothes.

“The buying power of consumers had declined so much since the implementation of GST. I was really angry when that tax came into effect.

“People would usually prefer to spend on food. The fact that our sales have improved indicates we will have a good Hari Raya this year.

“I hope to also see our sales pick up over the next few months,” she said.

Noorfarahain said although her boutique had one of the most competitive prices in the market, prices of clothing in the boutique were reduced following the zero-rating of the GST.

“It may not look like much was reduced from the original prices, with a difference of only a few ringgit, but if you buy a few pieces, you can save enough to get an additional piece.”

She added that, on May 31, the boutique was rather quiet but when June 1 came, the atmosphere in the boutique was lively again, as if people were waiting for the zero-rating of GST.

More sales

Fashion designer and boutique owner Danish Hassan said he saw a significant pick-up in business over the weekend on June 2.

“Although my boutique wasn’t subjected to GST, last weekend we saw many people at our boutique.

“Business has been very bad over the last two years. Over the recent weekend, I could feel that our customers could spend more than usual,” said Danish.

Being a fashion designer and running his boutique for the past 12 years, Danish said the last two years were the worst as far as sales were concerned.

“Now that people no longer have to pay for GST, they can at least spend on clothes,” he said.

However, another boutique owner, who did not wish to be named, said business had not improved much even though GST had been zero-rated.

“Business is still slow as usual. We expected business to pick up with Hari Raya.

“But we’re losing out to those who are selling items at a much lower cost.

“Since 2015, we have been surviving on regular customers. We used to be one of the cheapest local-made traditional wear retailers.

“Today, we are struggling to stay afloat,” said the boutique owner at Melawati Mall.

The boutique owner also noted that, back in the days without GST, they could make sales of RM100,000 during the Hari Raya season.

“Today, we are only able to hit a quarter of that. I really hope to see the economy improve with the GST being zero-rated.

“I know many others are suffering in this mall, struggling to meet the sales target.

“People are going to places like Jalan Tuanku Abdul Rahman and even Shah Alam to do their shopping, claiming things are cheaper there.”

Shopper Ruziana Ramli, 55, said prices had gone down after GST was zero-rated from June 1.

“If last year, I only bought a pair of baju Melayu, this year I managed to buy an extra jubah for my son,” the mother of three told FMT.

Ruziana said she had been out to do her Raya shopping three times already.

Roshayati Abdullah said she could save more and had noticed the difference in prices.

Hamidah Abdul Hamid acknowledged the price of goods had dropped, making it easier for her to shop for more clotehs for her children.

Tripic Berhad managing director Yusof Badawi said his company was helping unfortunate kids with their Raya preparations.

“The kids will enjoy another pair of shoes, new clothes and other stuff with the savings from GST.”

Shoe salesperson Siti Aisha, 20, said on June 1, her shop saw a lot of customers.

She said customers were now likely to buy more than a pair of shoes from her shop. -FMT