Restaurants, hotels 'overcharging' customers in Sarawak

MIRI - Up to 16 per cent increase in prices - that is what customers have to endure in some parts of the cities and towns in Sarawak after the Goods and Services Tax (GST) came into force.

Sarawak Progressive Democratic Party (SPDP) president Datuk Seri Tiong King Sing said restaurants and hotels are capitalising on the implementation of the GST to blatantly raise the prices they charged on customers.

The Bintulu MP, who is also PM's special envoy to Japan, Taiwan and Korea, expressed his shock to The Star that some of the eateries and hotels in Sarawak are charging up to 16 per cent extra.

Tiong said he had already complained to the Domestic Trade, Cooperatives and Consumerism Ministry, and had also raised the issue in Parliament during the recent sitting, but restaurants and hotels were still blatantly raising their charges.

"I have received information that some of these eateries and hotels are imposing all sorts of so-called service charges of up to 10 per cent, on top of the 6 per cent GST.

"This means that the charges had shot up by 16 per cent after the GST was enforced. The rakyat are very frustrated with these unreasonable increases.

"There are restaurants and hotels who are simply taking advantage of the GST implementation to charge their customers extra even though these premises are not affected by GST.

"There are also many traders who refused to reduce their charges despite complaints against them.

"The relevant authorities must do something urgent to stop these unreasonable price hikes before things get out of hand.

"There must be more serious enforcement on the grounds to stop these ridiculous price hikes. The rakyat are becoming very confused and frustrated with what is happening," he said.

Tiong said Domestic Trade, Cooperatives and Consumerism Deputy Minister Datuk Seri Ahmad Bashah Hanipah had told him that the ministry was trying its best to monitor the price situation.

Tiong pointed out that it was not enough to monitor.

"The enforcement on the ground must be effective enough to stop the blatant price hikes," he said.

In Miri, a check by The Star showed that there were also multiple increase in prices of foodstuff and drinks in coffeeshops and restaurants.

Some restaurants are even issuing handwritten receipts on the GST.

There are some eateries that refused to issue receipts even though they charged up to RM7 (S$2.60) for a plate of mixed rice and vegetables.

Several eateries have also increased their prices by at least RM1.50 per dish, and charge extra 6 per cent GST on top of the whole bill.

It was reported that many Malaysians were not aware until the recent GST was implemented that it was not compulsory to pay the service charge, which is usually 10 per cent of the total bill.

But now there is widespread outcry over the extra charge - which is taxed a further 6 per cent on top of the GST applied to the original purchase - and many are refusing to pay the amount.

The backlash was so strong that the Domestic Trade, Cooperatives and Consumerism Ministry issued a moratorium on restaurants charging the 10 per cent, which was first established decades ago in lieu of tipping.

Minister Datuk Seri Hasan Malek, said traditionally, a collective agreement (CA) between employees and employers regulated the percentage of the service charge given to each employee.

However, many restaurants adopted the practice even without an agreement, with owners pocketing the 10 per cent for themselves and workers never seeing a sen of it.

"That is profiteering. You are allowed to make a profit, but within reason. We have a mechanism to identify this and we will crack down (on errant operators)," said Hasan.