KUALA LUMPUR: Hartalega Holdings Bhd will apply to Customs Department to exempt raw materials from being subjected to the impending Sales and Services Tax (SST).
“We are talking to the Customs and other relevant authorities to make sure that by next week we are ready [for the successful implementation of SST 2.0]. But as of to date, there are still some things that are unclear,” said group managing director Kuan Mun Leong.
“We are an export-oriented company. We’ll apply for SST exemption, just like we did prior to the implementation of GST,” said Mun Keng, who is Hartalega executive director and elder brother to Mun Leong.
They were speaking with reporters after the company’s shareholders’ meeting here today.
Also present were Hartalega executive chairman Kuan Kam Hon and executive director Dr Danaraj Nadarajah.
Earlier this week, both houses in Parliament have abolished the Goods and Services Tax (GST) and passed all five bills related to the implementation of the SST, which is set to take effect on September 1, 2018.
Finance Minister Lim Guan Eng had recently announced the previous administration had delayed refunding GST claims totalling RM19.37 billion to 121,429 companies between January 2015 and May 2018 — despite being mandated by law to effect the refunds within two weeks from the date of claims.
The minister then promised the current administration will refund the GST claims owing to the companies, beginning 2019.
When asked if Hartalega is one of the corporate waiting for their GST refunds from Customs, Mun Leong nodded and said, “yes, but it’s best we don’t elaborate on this.”
Two weeks ago, Prime Minister Tun Dr Mahathir Mohamad reportedly said the government will not immediately increase Malaysia’s minimum wage to RM1,500 because a higher minimum salary will raise production and living cost.
Currently, the minimum wage in Peninsular Malaysia is RM1,000 while the minimum salary in East Malaysia, which comprises Sabah and Sarawak, is RM920.
When asked to comment, Mun Leong said Hartalega would have to pass on the higher cost from the impending rise in minimum wages, to customers.
“We’ll have no choice but to factor it into the glove prices, like other exporters,” he said.
On outlook for Hartalega, Mun Leong said its new anti-microbial gloves is due to be shipped to Germany next month.
“We’re also close to securing orders from South Korea.”
“We’re also submitting our applications to the Food and Drug Administration (FDA) next week for approval to distribute this new glove in the US by the first half of next year,” he added.
Currently, as the world’s most valuable glovemaker, Hartalega is able to produce 30 billion pieces of gloves per annum.
Mun Leong expects this figure to expand to 44 billion, by 2021, as new production lines are being added in.
