Just a click away: Keep track of online purchases and the new sales tax on imported goods worth below RM500.
PETALING JAYA: With a new sales tax to be implemented on online purchases of imported goods worth below RM500, sellers now need to provide local products that are diverse and of good quality.Many buyers say they preferred buying from abroad as the prices were cheaper.
Christine Ong, 26, who dabbles in art, said she preferred buying her art supplies from overseas sellers as they were more affordable. She also said it was hard to find the material she needed from local online sellers or even at physical stores.
“I usually buy items for my hobbies like painting or embroidery, but the items are harder to find in local stores. If available, the prices are way higher.
“Overseas sellers offer either the same brand at least 30% cheaper or a different brand with a comparable quality at a lower price,” said Ong, who spends about RM200 per month on online shopping.
She disagreed with the introduction of the new 10% tax rate on imported goods bought online.
“If the tax is to give the local producers an advantage, I don’t agree. Many vendors are selling the same items that are brought in from overseas. I could get the same items directly at a much lower price with greater variety of designs,” said Ong, a data analyst based in Kuala Lumpur.
Malaysia had been scheduled to impose a tax on goods costing below RM500 effective April 1, 2023, under Budget 2022, but it was postponed in March. It will now be implemented on Jan 1.
The Customs Department said the tax was “to ensure a level playing field and fair treatment between all LVG (low-value goods) purchased overseas or locally”.
“I believe that if locals could produce goods with more attractive designs and at a reasonable price, people will naturally opt to support local sellers,” said Ong.
“However, it could be tough to achieve a lower cost locally due to the economies of scale.”
She added that the new taxes will only further burden low- and middle-income earners.
Nurisa Razali, 33, concurred, saying consumers should not be punished with more taxes when local supplies were limited and costly. As a former small business owner selling artisanal flowerpots, she said she relied heavily on materials bought from abroad.
“I used to buy items related to my business which would cost below RM500 per item. Now, I don’t know if I can continue the business as this tax will increase my operating cost,” said Nurisa, who is taking a break from her business.
Graphic designer Eugene Lee, however, felt the tax would encourage people to spend locally and ensure a lower cash outflow.
“It will help local businesses flourish as there will be an increased demand for products that were only available from abroad. Sellers will be more creative in producing the items locally,” he added.
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