Luxury tax on gold will cause loss of jobs and revenue, say jewellers

 

The luxury goods tax, announced during the tabling of the 2024 budget, is set to take effect on May 1 next year. (Bernama pic)

PETALING JAYA: The proposed luxury tax on gold jewellery will lead to a significant loss of revenue for retailers, says Malaysian Indian Goldsmith and Jewellers Association (MIGJA) president Abdul Rasull Abdul Razak.

“The (proposed) 10% tax rate will heavily impact the selling price of jewellery in gold stores, which would lead many consumers to seek alternative sources, such as from Singapore or through unofficial sales,” Rasull said at a press conference.

“This will lead to a 10-30% loss in revenue for gold retailers, which in turn will cause lower production volume in 2024,” he said.

Rasull added that manufacturing and wholesale jobs would also decrease by 10-20% due to the lower production.

Among others at the press conference were Federation of Goldsmiths and Jewellers Associations of Malaysia adviser Ermin Siow and deputy president Pang Ann Puo.

“We urge the government not to implement the luxury tax on our gold industry because it will affect a lot of people in the industry, from the manufacturers to the suppliers and wholesalers.

“The government needs to hold a proper dialogue with industry players, such as bullion traders and manufacturers, to devise a suitable scheme for the industry,” said Pang.

The luxury goods tax, announced during the tabling of the 2024 budget, is set to take effect on May 1 next year.

Specifics regarding the implementation mechanism, types of goods applicable and the tax rates on high-value items will only be disclosed once the details are finalised and approved by the Cabinet. - FMT