By Khairul Khalid
Johor’s businesses are bracing for a worst-case scenario after the recent double whammy of Singapore’s recent increase of VEP (Vehicle Entry Permit) charges and the controversial toll hike at Johor’s CIQ (Customs, Immigration and Quarantine) for vehicles crossing into Singapore.
V. Sivadas
“These moves will increase cost of living and doing business here. While foreigners coming in from Singapore can easily afford such taxes due to their stronger currency, the same cannot be said for locals,” said V Sivadas, executive director of PA International Property Consultants in JB.
“Many locals have extended families living in Singapore. Many in the business community have business transactions through Singapore. Thousands go over to work and to study. These are local people bringing in hard earned foreign currency to spend in Johor Bahru (JB) and the rest of Malaysia,” he added.
Although Sivadas is more concerned about the escalating costs of Johoreans travelling to Singapore, the knife cuts both ways especially considering JB’s heavy reliance on Singaporean visitors. Already many businesses such as JB’s tourism industry, including hotels and F&B (food & beverage) that is heavily reliant on Singaporean customers reported drastic drops in businesses last weekend since the toll hike was enforced.
“The economic impact will be felt not just in JB, but all the way to Melaka, Kuala Lumpur and perhaps Genting Highlands as well. These are some of Singaporean’s favourite holiday destinations,” said a JB lawyer.
After the recently announced hike by Malaysian Highway Authority (MHA), inbound cars from Singapore through the JB Customs, Immigration and Quarantine (CIQ) Complex have to pay a toll of RM9.70, up from the previous RM2.90. Outbound cars from Johor to Singapore are now subject to a new toll of RM6.80.
Total toll charges for a Malaysian car’s round trip to Singapore via the CIQ is RM16.50. In response, Singapore is also planning to match Malaysia’s toll charges soon by charging RM16.50 for Malaysians exiting Singapore.
If that is implemented, Malaysian cars will have to pay approximately RM123 for a round trip to Singapore, inclusive of the new VEP and COQ toll rates.
“This is grossly unfair. The general public and business communities in JB are unhappy. Many who live and work in the city do not use the EDL (Eastern Dispersal Link) to enter the CIQ, yet they are being forced to pay the extra toll charges,” said Sivadas.
“The bulk of the road users using the CIQ use the inner ring road (a non-tolled public road) to enter and exit the CIQ. They were already being made to pay a toll previously. A small increase to reflect inflation would have been accepted without complaints for such users,” said Sivadas further.
The controversy surrounding the CIQ toll hike has been compounded by reports that it has been hastily implemented to recoup the spiraling costs of compensating EDL’s concessionaire MRCB (Malaysian Resources Corporation Bhd).
EDL cost an estimated RM1.4 billion to build. The federal government has reportedly been paying MRCB approximately RM11 million monthly as compensation for keeping EDL toll free.
The federal government has mulled taking over the EDL from MRCB but apparently that has not been approved, thus setting into motion the toll hikes.
According to Sivadas, the state has to be transparent on how this increase in toll charges will be spent.
“We are told this is to enable extra toll be collected to compensate for EDL and an undisclosed portion for CIQ maintenance. It would be interesting to find out portions of the new told being distributed to PLUS, MHA and MRCB (for EDL) For decades now, we have not solved the congestion on the causeway, even despite spending vast sums on the current poorly designed CIQ. It is a major bottleneck that is holding back JB,” said Sivadas.
Sivadas also adds that although the toll hikes currently only applies to the Sultan Iskandar CIQ complex and not the Malaysia-Singapore Second Link (Linkedua) in Gelang Patah, he expects an increase to be implemented at the Second Link too, in due course.
“I guess it’s only a matter of time,” said Sivadas.
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