Why we have to pay RM50 more?

Starting from 1st January 2010, all credit card holders will be imposed with RM50 government tax on top of the annual fees that they are paying to the bank all this while. The first thing that came into my mind is that this move is introduced to prevent too many people signing up for credit cards and at the end of the day ended up becoming bankrupt due to inability to pay for the credit cards' debt.

I have started using my credit card since 1998/99. At that point of time to get a credit card is not as easy as today. The compliance rules are quite strict e.g. you cannot get a credit card if you're not gaining enough income to have one. But, still with some 'help' I managed to get a credit card - instead 2 credit cards - Master and Visa (which I have cancelled one of them because both were carrying the credit limit amount together). My salary at that point of time is RM2000 (nett) and what stopping me from getting the card in a 'clean' way is my working status as 'contract worker'. Till now, I still retained the card (I mean the account - the card itself has been replaced in a number of occasions).

Looking back at the issue of imposing RM50 annual tax to credit card holders, I am at first not too keen as I thought only new applicants will be charged the RM50 fees. But, later I found out that current card holders were also being charged the same amount and to make it worse is that you'll be charged when you're renewing the card or during when its annual fees need to be paid.

In my experience, I came across three types of credit cards owner (not user):

1. Those who have credit cards and like to spend all the time using their card.
- this category can further be divided into two i.e. those who can afford to pay and those who cannot afford to pay

2. Those who like to boast or looks cool for keeping credit card in their wallet.

3. Those who need to keep credit cards for emergency usage.

The RM50 tax will not be strongly felt by the first category especially the second type in the first category.

It might hit the target of eliminating the second category of credit card owner.

However, it will be a big slap to the third category of owner.

For me, I was once the second category when I first started having credit cards, I have fallen into the first category (both types in this category) as well and now I've considered myself as the third category.

Credit card would be handful when you need to book a room in a hotel during outstation works or if your work demand you to travel all around, having a credit card which debt you can pay when you received your salary or allowance for the travel you made is something to be think about.

Thus I think it is unjustified to charge the RM50 especially for the last category of credit card owner. It might be more reasonable to charge a person on his second or third credit card that he or she has. Even that, having two credit cards are sometime beneficial especially when your first credit card cannot 'go through' in a transaction, so you still have a second lifeline for that.

It is also might be more reasonable for the government to charge the bank the RM50 for any issuance of credit cards to a new applicant or for current applicant who the bank will be giving him his second, third or even seventh credit card under his name. Hence, any bank will think twice before issuing any credit card. After all bank has been taken our money from unreasonable and irresponsible source i.e. charging RM0.50 for the fourth and more cash withdrawal that we made.

The RM50 is introduced during high time when inflation hit the world (even though Malaysia seems to be inflation-free..hmmmph..), when the price of basic goods keep rising - illogical enough during festive season...and we have so many festive seasons to cherish in a year. Further, the introduction of 4% GST next year still remain a mystery in terms of the impact that it may carry.

By the way, I just wonder if we can pay the RM50 tax using a credit card??!!