PETALING JAYA: Local car companies can claim the 10% sales tax on unsold stock after the implementation of the goods and services tax (GST) – if they can produce documented proof of purchase.
“If you’re holding stocks that had been paid for, you will get a full refund if you can produce the invoice that shows you have paid the sales tax,” said a customs officer who cited the GST Act 2014.
According to Section 190 (1) of the Act, a person is entitled to a special refund equal to the amount of sales tax in respect of the goods held on hand.
Under Section 190 (1) (d), the claimant is required to hold the relevant supplier’s invoice, proving that he is the recipient for which sales tax has been charged, or import documents proving that he is the importer, consignee or owner for which the sales tax has been paid.
The refund is also applicable to suppliers other than a licensed manufacturer, namely those further down the supply chain, such as dealers. However, the second and third tier dealers are not entitled to the full refund.
Among others, the claimant must be able to prove that he is registered, that he is in possession of the goods he is claiming for, and that he has paid the amount shown on the invoice.
Local car companies are requesting from the Government that they be allowed to reclaim the full 10% sales tax on invoices issued prior to the implementation of GST, which takes effect today.
In a statement yesterday, Perodua Dealer Association president Wan Kamal Wan Ismail said its unsold stock, with 10% sales tax already paid, would now be hit by an additional 6% post-GST.
“Each independent dealer will stand to lose an average of RM230,000 on double taxation after April 1,” he said.
The customs officer, meanwhile, said the impact would be minimal on car companies that still had unsold stock post-GST.
“The stock is unlikely to be that big. Furthermore, these are big ticket items and most car companies don’t keep them for too long.
“The impact won’t be adverse. If there are still unsold stock, it will usually be sold within a few weeks.”