Friday, February 26, 2016

Costly affair when death meets tax‎es

Even in death, Malaysians are not spared the rising cost of living, as funeral services and ceremonies have become more expensive in recent years, compounded by the goods and services tax (GST). Checks at various funeral parlours showed that a non-Muslim's last journey could cost nothing less than RM4,800. Richard D. Ernest, funeral director of Heaven Funeral Care, which provided funeral services to Christians, Taoists, Buddhists and Hindus, said the cost of funerals had gone up since two years ago. In addition, since last April, his services have been affected by the consumption tax imposed on coffins and materials for last rites. Previously, burial services cost between RM4,200 and RM4,500. Today, prices start from RM4,800. "The biggest impact for us is the GST. Its introduction saw the cost of the goods and materials we use soar." "When we explain this to our clients, many understand, but what about those who can't afford it?" he said, adding that GST was also imposed on canopies and mourning ceremonies, including food and drinks, which were procured from suppliers. At the same time, Ernest, 51, said his company could not transfer the cost of GST to his customers as funeral, burial and cremation services were exempted from GST. "We are GST-exempt. We don't pay GST so we can't charge GST, but when we buy our raw material we are subjected to GST. This is our challenge now." In addition, he said there was the uncertainty of transport costs, which depended on the price of petrol. "The cost of funerals has increased tremendously in the past two years. First, the price of petrol has gone up. "That means our casket cost has gone up as the supplier said the cost of transport has to be added. It's a chain effect. When that happens everything else goes up." Ernest, who has been running the business with his partner Lianna for the past three years, said his company's funeral packages start at RM4,800 and only applied to Christian and Buddhist funerals. "For the Taoists, it is more expensive because there are a lot of customs and priests involved and a lot of prayers and materials are required for the funeral service. At RM4,800 there is no way I can get it done. "The Taoist funeral services start at RM8,500." Asked what could be done to reduce the prices of funerals, Ernest said the local government should consider relaxing conditions on public burial plots. "A government burial plot is about RM200 to RM250. In Petaling Jaya, if a client wants to conduct a burial, he has no place. In Shah Alam, there is a burial plot but it is only for Shah Alam residents. "In Cheras, they are opening the last plot but the ruling is that it is only for the residents of Kuala Lumpur. So you have one in Shah Alam, you have one in KL, what about those in PJ?" As for knock-on effects of the weak ringgit on funeral costs, Ernest said he did not expect the price of their services to be affected as all items used were sourced locally. Instead, he was more concerned about clients being able to afford his services given their reduced purchasing power. Although it was a business, funeral services were also about the need to pay last respects to the dead, he said. "The bottom line is to send the dead off properly. It is not about how much money I can make out of it. I ask them how much they can afford and then I cater to that." Different prices for cremation Another funeral service operator, Siva Subramaniam, said costs depend on current prices of the coffins and crematoriums. In 1989, the minimum price of funeral services was RM1,300 but now it was RM2,500, with a basic coffin design. Cremation costs varied according to location, said Siva. "The Petaling Jaya Municipal Council charges RM180. In Cheras, it is RM100 only. In Sentul it is RM400 if firewood is used. "In Loke Yew, it is RM600 for a firewood cremation. However, in Shah Alam it can cost up to RM750." Siva also said that although GST has pushed up costs, he was unable to raise his price as he considered this a service to society. "The casket suppliers charge us GST but we don't charge GST to our customers." Meanwhile, Al-Ikhlasiah Pantai Dalam mosque undertaker, Hamdan Mohd Yusof said for Muslims, the cost for cleaning the remains, Islamic prayers and the shroud as well as burial came up to RM950. The motorcycle workshop owner, 47, said he has been offering undertaker services on a volunteer basis for the past 15 years. Giving a breakdown of the cost of a Muslim burial, Hamdan said it cost RM350 to dig a grave, while the cost of cleaning and shrouding the remains was RM150. The cost of the hearse is set at RM1 per kilometre, he added, saying that if someone wanted to transport a person's remains from Seremban to Kuala Lumpur, the round trip for the hearse could cost as much as RM100. But that price, he added, was subject to current transportation costs and highway tolls. Hamdan said all the payments were channelled to the mosque's burial fund, without any profits taken for himself or anyone from the mosque. "This volunteer service is not for all as it requires one to be honest, trustworthy and the ability to be near a dead body." – February 27, 2016.]]>

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