Pua: Punish phone companies as profiteers

MP contrasts giants with billions in profits being let off, while small traders face crackdown.

PETALING JAYA: Telephone companies, who make billions in revenues and profits, should be charged for profiteering, said the MP for Petaling Jaya Utara, Tony Pua, as he accused the government of duplicity and bias in favouring large companies against petty traders with a flip-flop policy on GST on prepaid mobile services.

He question why the government treated multi-billion telecommunications companies with kid gloves while ordering action against petty traders who were forced to raise prices because GST had increased their cost of doing business.

He said Maxis, Digi and Celcom made pre-tax profits of RM2.44bn, RM2.65bn and RM3.1bn respectively in 2014 and collected RM12.8bn in prepaid mobile services revenue for the year.

In the past, the companies had absorbed the sales and services tax on the sale of prepaid mobile services, he said. “However, they took advantage of the Goods and Services Tax to pass it on to customers”, resulting in an immediate price increase of 6%.

Pua said it was “stupefying” that the government had not resolved the issue a month after GST was imposed.

He said yesterday’s announcement by the prime minister that Ahmad Shabery Cheek, the information minister, would now take charge of announcements on the top-up issue, represented a victory for the phone companies.

Deputy finance minister Ahmad Maslan has been the government’s chief spokesman on GST, but run into controversy and criticisms for his apparent inability to explain GST and the top-up issue.

Pua said Ahmad had threatened on April 2 that the government would take the phone companies to court for raising the prices of prepaid services.

After several conflicting announcements by the Customs and the communications commission, Ahmad Maslan said prepaid reload cards would revert to pre-GST prices on May 1. However, the companies did not do so yesterday.

Pua, MP for Petaling Jaya, said Shabery Cheek had defended them, saying that the complexity of reconfiguring their payment systems made it difficult to do so.

“The excuse…is nothing more than utter bunkum,” said Pua, an IT entrepreneur who came into politics after listing a successful business.

Pua accused the phone companies of acting like a cartel; their refusal to stop absorbing taxes and to pass them onto consumers was nothing less than profiteering.

Yet Najib Razak had called on the relevant authorities to come down hard on the profiteers and unscrupulous traders who manipulated the GST for their own extra financial gains.

Pua questioned why the authorities were only allowed to “come down hard” on ordinary traders, many of whom were forced to raised prices because of increased cost of doing business but giant multi-billion-ringgit telecommunications companies blatantly raising prices and profiteering from GST were treated with such kid gloves.