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Credit Card Service Tax Announcement
Please be informed that effective from 1 January 2010, all individual and corporate credit cards including virtual credit cards will be imposed a service tax. This is in accordance to the Budget 2010 announcement to impose service tax on credit cards.
Taxable amount
| Principal Credit Card | RM 50 per card per year |
|---|---|
| Supplementary Card | RM 25 per card per year |
Taxable period
| New Card | Service tax will be imposed on card open date and subsequent card open anniversary date every year |
|---|---|
| Existing Card | Service tax will be imposed on the card open anniversary date every year |
Redeem Hong Leong Reward Points for Credit Card Service Tax
Hong Leong Credit Cardholders are allowed to use their reward points to redeem for the Credit Card Service Tax Fee and it can only be redeemed after the service tax has been charged on your statement.
| Credit Card Service Tax | Reward Points |
Product Code |
|---|---|---|
| RM 50 service tax for PRINCIPAL | 10,000 |
P101 |
| RM 25 service tax for SUPPLEMENTARY | 5,000 |
B101 |
In the meantime, do continue to enjoy various privileges and rewards with Hong Leong Credit Cards.
Frequent Asked Questions
- What is this credit card service tax about?
This is in line with the guidelines issued by the Ministry of Finance in respect of the imposition of a service tax on credit cards effective 1 January 2010 as announced in the 2010 Budget Speech. The Bank is collecting the service tax to be paid to the Director General of Customs and Excise.
- How much is the service tax?
Principal cardholders will have to pay RM50 for each card, while supplementary cardholders will have to pay RM25.
- When will I be charged the service tax?
The service tax will be effective 1 January, 2010. The service tax will be charged when the card is opened or renewed. The amount of service tax payable will be posted in your monthly statement. Examples:
Example for a new card opened, which is valid for 4 years
A new credit card opens on 15 April 2010 with a validity period of 4 years expiring on April 2014. A service tax of RM50 would be chargeable on 15 April 2010, the date of card opened and on every subsequent anniversary date i.e. 15 April 2011, 15 April 2012 and 15 April 2013.
Example for an existing card, which is valid for 4 years
Cardholder holds an existing credit card that was opened on 22 December 2008 with a validity period of 4 years expiring on December 2012. No service tax would be chargeable when the card is renewed on December 2009 as the service tax will only be effective 1 January 2010. A service tax of RM50 will be chargeable when the credit card is renewed respectively on 22 December 2010 and 22 December 2011.
- I'm holding 2 Hong Leong Credit Cards, will I be charged the service tax the same time or follow the individual card anniversary date?
The service tax will be chargeable on the individual card open anniversary date.
- Will I still be charged service tax if my card is free-for-life?
Yes, the service tax is still chargeable.
- Will service tax be applicable to Mobile Money?
Yes
- Will service tax be applicable to Touch'n Go zing card and Balance Transfer?
No
- I have just paid the service tax 2 months ago. Would I be charged service tax again if I change my card?
No service tax will be imposed for cards replaced due to lost, damaged or fraud. However, if you request to change your card to a different card type (e.g. Visa Classic to Essential), then you will be charged the service tax for the newly issued card.
- If I cancel my credit card before the card open anniversary date, would I be charged the service tax?
The service tax will not be imposed on card cancelled before the card open anniversary date. It is encourage that you cancel the card at least 2 weeks before the card open anniversary date to ensure the service tax will not be billed to your account.
- If I reapply for a new credit card 1 month late, would I still be charged service tax?
Yes, the service tax will be chargeable as this is considered a new card issued.
- If I decided to reinstate my cancel card 2 months later, would I still be charged service tax?
The service tax will still be chargeable on the reinstated card open anniversary date. Example: If you have paid the service tax for the cancel card prior cancellation, hence you will be charged the service tax next year on the same card anniversary date.
- Can the service tax be waived?
No. However, we have extended our reward redemption option to allow our Cardholders to use their reward points to redeem against the service tax.
- Can I use reward points to redeem for the service tax?
Yes. You will need 10,000 reward points to redeem against the service tax for principal card and 5,000 reward points for supplementary card.
- When can I redeem the service tax and how do I do it?
You can ONLY redeem the service tax with your reward points after it has been charged to your credit card. You can redeem it by completing and signing off the redemption forms via fax; Mail back the forms to the Bank; Making redemption orders via online; IVR (Interactive Voice Response) or Call "N" Redeem. The redemption form can be downloaded at www.hlb.com.my
Note: Only Principal Cardholders are allowed to make redemptions.
- How many times can I use my Rewards Points to redeem the service tax?
There is no restriction as long as you have enough rewards points for the redemption.
- Will the redemption be automatically deducted from my payment of that month?
The RM50 and/or RM25 redemption will be reflected in your next month statement as a credit balance. Hence, it is encourage that you make payment for the service tax first to avoid late payment fee and/or finance charge.
- Is there a cut-off date for the redemption?
Yes. You MUST redeem within 3 months after the service tax is charged to your credit card account.
- I do not have enough reward points to redeem for the service tax. What do I need to do to redeem?
You may continue to spend with your Hong Leong Credit Card to earn more rewards points.
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