KUCHING: The abolition of Sales and Service Tax (SST) on consumer goods with the exception of a few items is expected to bring down the cost of living for the majority of consumers.
However, Dayak Chamber of Commerce and Industry (DCCI) advisory panel member Datuk Leonard Martin Uning said the government must come up with the implementing mechanisms and also address the cost differences between the urban and rural consumers.
He pointed out that for rural consumers in Sarawak, the abolition of SST alone will not be sufficient to bring the cost of living down for them.
“The infrastructure development of road connectivity has helped a lot but the price differentials of items such as fuels, and the main food items such as cooking oils, rice, meats and eggs, will have to be addressed by the use of a tailor made targeted subsidy mechanism especially for selected items,” he said when contacted by Sarawak Tribune.
He also raised concerns about the ability to ensure the savings from the removal of SST are passed on to consumers.
While the removal of SST from retail bills for consumer goods – including at supermarkets, retail outlets, and pharmacies – can be monitored, he pointed out that it is much harder to ensure prices will decrease accordingly.
“To expect SST to bring the cost of living down is complex. Nevertheless, the SST proposal is a good start and the government deserves to be commended for this progressive proposal,” he said.
On the issue of who will be responsible to ensure the costs of consumer goods will come down and that the abolition of SST will benefit the consumers, Leonard suggested that for a start, the main food items which have been the subject of price control during festivals should be considered as a permanent solution mechanism.
“In addition to this, I suggest that a strong mechanism for price-tagging control be made mandatory for prices of drugs and food supplements and to be monitored closely by the Ministry of Consumer Affairs.
“This is to prevent retailers from taking advantage of consumers, especially with the increasingly common membership-based pricing models,” he said.
Meanwhile, addressing the relevance of the 2025 Budget’s SST proposal for young consumers, he stressed that it is particularly pertinent.
He stated that eateries and restaurants must be recognised as one of the establishments which have contributed significantly towards the high cost of living and especially among young consumers.
With many young people eating out regularly due to lifestyle or work constraints, he expressed hope that the removal of SST would bring some financial relief by reducing the cost of dining out.
“There are no easy solutions. However, these problems deserve to be looked after seriously by the government. The young people are our important assets. Let’s start talking,” he said.
