The Malaysian government has decided to impose a service tax of RM50 for each principal credit card holder wherelse the supplementary card would be penalised with a service tax of RM25.
Reason given for the implementation of the service tax is to 'teach' credit card holders to spend wisely. What else does the government want to teach me where my credit card balances are clean every month? That I reduce my charges to the credit cards in spite of me having settled all amounts every month? You call that teaching but I call it penalising.
As I'm renovating my house, I was able to charge to my credit cards for lots of purchases and raked up lots of points at the same time lately. I do have the cash but I prefer using my credit cards to pay for it owing to the points.
Unfortunately, the government has decided that I'm to be penalised for using the credit cards. Ok, maybe the government has to think of some ways to earn some revenues to maintain the nation's economy.
But what do you say when the merchants, who have signed up with banks to have a credit card facility in their businesses, are also charging consumers like you and me.
Of late, I have been shopping around for many stuff for the house renovation. Certain shops (not all) that accept the usage of credit cards (applies to both VISA and MASTECARD) for payments have told me this - "I have to charge you 3% extra because you are using the credit card to pay". If you pay by cash, it'll be a bit cheaper.
The goverment is taxing me and now the merchants are passing their costs to me as well. In the end, it's the consumers that are dying.
As far as I understand is that merchants arranged to have credit card facilities in their business premises for their customers' conveniences. At the same time, they'll tell their customers that the credit card facilities were set-up for the benefit of the customers but the customers would have to bear that costs. Fair?
One merchant has fixed the amount of money to be paid if you use your credit card. Say RM5 for each credit card transaction.
What does VISA and MASTERCARD have to say about such practises? Does your company explains to the credit card users who should bear that 3% charges?
What does our local banks have to say about such arrangements? Do you all (banks) know about such games being played?
Are the merchants permitted to pass the costs to the customers? What's the answer?
Tags: VISA, MASTERCARD, Service Tax, Credit Card