I refer to the letter, "食阁收 GST多收5分钱" (Wanbao, 26 Jan).

As correctly pointed out by the writer, a business with an annual turnover of more than $1 million is required by law to register for GST. However, a business with an annual turnover of less than $1 million may choose to register for GST voluntarily. Food stalls in food courts that collect GST may fall under either of these categories, just like any other company or business.

A GST-registered business must show "GST-inclusive" prices on all its price displays and advertisement or publicity brochure. The food stalls that are GST-registered are therefore required to show "GST-inclusive" prices. Only hotels and F&B outlets that impose service charges are allowed to show "GST-exclusive" prices. GST-registered businesses that do not comply with these price display requirements may be penalised.

GST-registered businesses are allowed to round off the GST amount to a whole cent. For example, if the GST-inclusive price is $7.00, the GST amount is 7/107 x $7.00 = $0.457, rounded to $0.46. On the other hand, if the GST-inclusive price is $6.90, the GST amount is 7/107 x $6.90 = $0.451, rounded to $0.45.

We have since contacted the food stalls concerned. We thank the writer for his feedback.