Rafizi: Consumers burdened, remove the service charge

KUALA LUMPUR, 9 Apr: Service charges imposed should be abolished because it has a negative impact and burdens consumers.

Rafizi Ramli (PKR-Pandan) said that the federal government still has no plans to establish laws on the matter, which harms consumers.

“I see that the government has no laws that can prevent traders from charging the service tax.


“The question is whether the government wants to establish new laws to ensure that the service charge really goes to employees. But at the present moment, the service charge is partially included in prices.

“That is why traders are free to impose service charges and the GST will be charged on the price (of goods), plus service charge. So, ultimately the ones losing are the consumers,” he said at the Parliament lobby today.

Based on his experience auditing restaurants in London, the ‘tipping’ concept that is practiced abroad separates it from the returns or business sales.

He said that the culture is indeed different from the service charges practiced in Malaysia because the ‘tipping’ culture practiced abroad has its own provisions of law.


“What is happening is that our culture is uncomfortable with the tipping culture.

“If it is to be separated, the government should set rules as soon as possible to prevent merchants and restaurants from charging the service charge which should be included in the price.

“All this while, consumers are always cheated because when we look at the price of food, it does not include the 10 percent service charge. The service charge is entirely the trader’s profit,” he said.


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