Deputy Finance Minister Ahmad Maslan has urged the break-up of monopoly in the telecommunications market after telcos were found collectively hiking prices of reload coupons along with the introduction of the goods and services tax (GST).

 

Four telcos - Celcom, DiGi, Maxis and U Mobile - were caught rising reload coupon prices although prices should remain the same with GST.

 

Instead of replacing the six percent earlier levied for the now abolished service tax, the firms incorporated it into their profits and charged an additional six percent GST.

 

The GST was meant to replace the sales tax.

 

“We should break their monopoly so they listen to what consumers want,” said Ahmad on his Twitter.

 

After being caught raising prices, the telcos said they will give six percent more talktime to compensate for the overcharging, but Ahmad said most consumers would prefer that prices remain the same.

 

"They want (lower rates) instead of being charged a six percent tax (with) more airtime," he tweeted.

 

Therefore, the minister said he has instructed the Customs Department to discuss the matter further with the four telcos.

 

"Before another decision is made, many want proof of the additional airtime.

 

"It is better for telcos to conduct a survey, to determine whether consumers want a lowered price of top-ups or more airtime," he said.

 

He said about 40 percent of complaints received on the first day of GST implementation on Wednesday April 1 concerned reload coupons.

 

The problem prompted consumer rights activist Muhammad Shaani Abdullah to raise the alarm of profiteering and price-fixing among the telcos for reload coupons.

Gerakan 'no' to talktime deal

Gerakan Youth chief Tan Keng Liang however said the additional talktime concession was unacceptable because the government had already promised that telcos would not be allowed to impose GST on prepaid cards.

 

If they fail to comply, he said, the government must take action on the four.

 

“Why must exception be granted to the telcos?” he asked in a statement today.

 

“With due respect to the Customs Department, the directives by the government, whereby GST should not be imposed on prepaid reload cards must be adhered by the telcos.

 

“In the event the telcos refuse to comply with such directives by the government, then the Customs Department should enforce the directives and take action against the telcos under the Goods and Services Tax Act 2014.

 

“The Customs Department should not compromise and backtrack on the decision by the government yesterday,” said Tan.