PUTRAJAYA, April 3 — Putrajaya told consumers today not to patronise businesses that charge a mandatory service charge if they are unhappy with it, after Deputy Finance Minister Datuk Ahmad Maslan erroneously said the charge is optional.
Domestic Trade, Cooperatives and Consumerism Ministry secretary-general Datuk Seri Alias Ahmad said the government does not regulate the service charge of 10 per cent at most outlets, which he described as a “universal practice” agreed upon by industry players and their employees.
“It is better for consumers to ask hotels or restaurants whether they have a service charge or not. Consumers have the right to not patronise that premise and go elsewhere,” he told reporters during a joint daily press conference with Customs Department’s Goods and Services Tax (GST) director Datuk Subromaniam Tholasy at the Finance Ministry office here.
Subromaniam explained that the GST is charged on the total sum received by businesses following complaints that the consumption tax is imposed on the 10 per cent service charge, instead of on the base price of the bill.
Previously, a 10 per cent service charge and a 6 per cent government sales tax was charged on the base price of the bill.
Alias also said today that consumers can sue the hotel or restaurant if they are unhappy after paying the mandatory service charge.
He added that there is a working committee among the hotel and restaurant associations, the Finance Ministry and the Human Resources Ministry to arrive at a permanent solution to the issue.
According to Alias, the Domestic Trade, Cooperatives and Consumerism Ministry and the Customs Department have thus far checked on 14,251 premises and issued 133 notices under Section 21 of the Price Control and Anti-Profiteering Act 2011.
They are also investigating 43 cases under the same law.
