[size=17.6000003814697px][size=17.6000003814697px] HERE’S a suggestion: If you want to go on holiday, do it now if you’d like to save some money. If I were to be more specific, try to travel before April 1, 2015.
You would have read by now about how the Goods and Services Tax will come into force in April next year. The GST, referred to in some countries as VAT or Value-Added Tax, is a form of revenue for the government and is collected on taxable items and services.
In other words, if a particular good or service falls within the list of taxable supplies, come April 2015, consumers will have to pay a higher price for these items than what they are paying now.
How about travel?
When we travel, the bulk of our expenses goes towards transport, accommodation and dining. Unless exempted or zero-rated (where the customer will not be taxed), such expenses will be subject to GST.
An Industry Guide published in August this year by the Royal Malaysian Customs Department sets out the application of GST in the travel industry:
http://gst.customs.gov.my/en.
Based on the industry guide, here’s a look at how the Goods and Services Tax is going to affect the cost of your holidays from April 1, 2015.
Domestic travel
* Everything concerned with travel within Malaysia such as domestic flights, inbound package tours, hotel accommodation, hotel booking fees, tour guide services and entrance fees will be subject to a standard rate of GST of 6%.
* Air ticketing service fees, airport tax, passenger service charge, travel insurance and fees for arranging travel insurance will also be subject to GST of 6%.
* If a local travel agent has commissioned another travel agent to run an inbound package, GST will be charged on the commission payable.
* Other items subject to GST are airport taxi fares, airport limousine hire, chartered bus hire, car hire and self-drive car rentals.
* Items exempted from GST are taxi fares and public transport by land and rail (such as RapidKL, KTM, LRT, ERL and MONORAIL).
International travel
* International flights (including connecting flights within Malaysia) and outbound tour packages will be zero-rated, that is, the customer will not be charged for GST, as they relate to services consumed outside Malaysia.
* However, air ticketing service fees, airport tax, passenger service charge, travel insurance and the arranging of travel insurance for international travel will be subject to GST.
* Also subject to GST are visa and visa fees (service or administrative fees imposed).
The application of the Goods and Services Tax on domestic travel is largely straightforward but confusion may arise when it comes to international travel, where tour packages will have both standard-rated and zero-rated elements.
For instance, the price of a package to London will be zero-rated but GST will be imposed on service fees, commission, airport tax and the passenger service charge.
As consumers who will want to know what we are paying for, it will be up to us to understand the GST and its workings.
Another impact of the tax is that unless airlines absorb the GST for local flights, domestic flight tickets will cost more from April onwards. Analysts are of the view that this increase in price is likely to have repercussions on demand.
The introduction of the GST in a few months’ time is likely to result in a hike in prices in many items, including travel-related products and services.
If, like me, you are not planning on travelling any less, it might be the right time to either cut down on non-essential spending or to go on holiday before the GST kicks in.
发表于 4-11-2014 07:56 PM
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