Maintaining a balancing act to address profiteering

GOVERNMENTS make tough decisions all the time. A nation is a patchwork of values and interests, and some of these clash. In the end, government policies and actions have to be based on the big picture and must serve the greater good.

That sounds clichéd, but it is no less true. And we will see it in action with the review of the Price Control and Anti-Profiteering Act 2011 in response to complaints from businessmen.

Specifically, many retailers are unhappy about the Act’s provisions that outlaw profiteering, which is defined as making “unreasonably high” profits.

They point out that these provisions had been introduced ahead of the implementation of the Goods and Services Tax (GST) in April last year. This is to deter businesses from using the tax as a convenient (and false) excuse when imposing price hikes that are disproportionate to cost increases.

The business community argues that the anti-profiteering provisions are useful only during the GST transition period and it is now time for the provisions to go.

The businessmen say market forces should be allowed to determine prices. It is unfair and burdensome, they add, for the authorities to have a say on the kind of profit margins businesses should enjoy.

Domestic Trade, Cooperatives and Consumerism Minister Datuk Seri Hamzah Zainuddin said on Thursday that his ministry had been given until December to engage with stakeholders on what should be done with the anti-profiteering provisions.

We already know what the businessmen want. To them, restrictions of law usually hinder growth and profitability.

On the other hand, we consumers always welcome laws that help shield us from unethical business practices. Perhaps more so now as we adjust to the impact of the Government’s subsidy rationalisation programme and the challenging global economic conditions.

Is it possible to please both sides in equal measure? Probably not, but there is certainly a right way to handle the situation.

It must start and end with transparency, thoughtfulness, hard work and good intentions.

The consultation with stakeholders needs to be a robust and inclusive process.

It is a time to listen and to gather as much information and as many views as possible.

The Star Says.

Read more @ http://www.thestar.com.my/opinion/columnists/the-star-says/2016/07/17/maintaining-a-balancing-act-to-address-profiteering/

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