Malaysian consumers are expected to see higher prices for imported fruits as a result of several converging cost pressures. Industry traders warn that a 5% sales and service tax (SST) on imported fruits, rising freight charges at Port Klang, and increased electricity tariffs in Peninsular Malaysia will all contribute to the price surge.
According to Kuala Lumpur Fruits Wholesalers Association President Chin Nyuk Moy, Port Klang will raise container handling and storage fees, while electricity tariffs are also set to increase. These combined factors will significantly inflate operating costs for importers. She noted that many imported fruits already face duties ranging from 5% to 30%, depending on type and origin, and now must also contend with SST and additional transport and energy expenses. Chin, who operates a cold storage facility, revealed that her monthly electricity bill has reached around US$12,700, which she described as a heavy burden on businesses.
Imported fruits such as apples, oranges, pears, and grapes are among those likely to be affected. Chin emphasized that fruits are not luxury goods but essential daily items, arguing that, like vegetables, they should be exempt from SST. She warned that while fruit sales typically spike around the 1st and 15th days of lunar months, the added cost burden could depress consumer demand.
Northern Kuala Lumpur Traders Association President Ong Mok Hooi echoed these concerns, saying the SST expansion will place added strain on small and medium-sized enterprises (SMEs), which are already grappling with economic uncertainty. He underscored that SMEs are the foundation of the country's economy and should be supported rather than burdened during times of financial stress.
Adding to these concerns, wholesaler Khiew Yoon Chin observed that consumers are already experiencing the effects of inflation, paying more for less following a recent diesel price hike. With the SST now being extended to cover all imported fruits while local produce remains exempt, traders fear that price competitiveness will erode further, leading to declining sales and tighter margins.
The compounded effect of higher taxes, shipping fees, and utilities reflects a broader challenge for Malaysia's fresh produce sector. As costs climb across the supply chain, the impact is expected to ripple through to end consumers, highlighting the vulnerability of food systems to regulatory and market pressures. Industry representatives are calling for reconsideration of the tax policy, emphasizing the essential nature of fruits in daily nutrition and the need to shield SMEs and consumers from further economic strain.
Source: The Star