so, Lulu should share with you all how the industry suspects GST will be implemented.
Actually, no one knows as the government
a. has been tight lipped about it
b. is still totally clueless about it
If you ask your friends in the accounting houses, they'd probably tell you that in the early days, they were invited for some consultations where some of the paling basic, dungu-est questions were asked. And the pace practically went to zero after the postponment was announced.
btw, Lulu did hear just recently that a delegation went to NZ to study their system, you know, one of those "Lawatan Sambil Belajar" things.
This is how the industry guesses the calculations and payment will be done.
for example, if today, you pay RM1.00 for a can of cola from your local grocer, when GST is implemented, [assuming gst is 5%], you would be paying RM1.00+RM0.05 to the local grocer.
but before the local grocer had sold the can to you, a series of events had happened in the chain supply.
We'll start with what happens at the cola factory.
ColaFactory would have paid their supplier RM0.525 for the raw material to make that drink. Out of that RM0.525, RM0.50 went to the supplier, and the other RM0.025 the supplier has to pay the government for GST.
The raw goods are processed and made into a can of coke. ColaFactory does their costing, taking into account the material cost, the labour, expenses and profit, marks it up to RM0.85 to sell to your local grocer. ColaFactory would invoice the grocer at RM0.8925 [=RM0.85+RM0.0425] and that is the amount your grocer would pay ColaFactory. ColaFactory, just like their supplier pockets the RM0.85, and pays the government RM0.0425-RM0.025 = RM0.0175.
The GST will be incurred at every level of the chain.
the amount paid by the each level is paid back to them via the invoice to the next guy on the chain, and ultimately, paid by you the consumer.
Yup! You're the one who's actually paying for the RM0.025+RM0.0175+RM0.0075 even though it was collected at every level.
Why every level? It is believed that the government wants to ensure minimal escapees.
Some comments mentioned sales tax. It is believed that the sales tax will be abolished then.
As Lulu mentioned earlier, no one really knows. We will have to wait for the elections to be over to know for sure.
GST - everybody gets to pay!