KUALA LUMPUR: The government has no plans to implement the Goods and Services Tax (GST) as the current Sales and Services Tax (SST) structure better supports its targeted taxation approach.
In a written parliamentary reply, the Finance Ministry said goods and services used by most people are generally not taxed under the SST.
It added that the government believes the income of most Malaysians is still too low for a broad-based tax like the GST to be imposed.
"The implementation of SST also provides a faster fiscal impact for the government compared to reintroducing GST, which would require a longer preparation period, up to two years, to allow companies time to update their systems for GST compliance," the ministry said.
The ministry was responding to a question from Datuk Dr Nik Muhammad Zawawi Salleh (PN-Pasir Puteh), who had asked if the government was working to create "GST 2.0" by expanding the SST's scope in stages.
It said measures to enhance revenue would be implemented carefully, involving engagement with stakeholders and taking into account the country's fiscal needs while ensuring the burden is not placed on the people.
Meanwhile, in a separate response to a question from Jimmy Puah (PH-Tebrau) on the SST for imported fruits, the ministry said it expects to collect an additional RM38 million from this.
"The revision and expansion of SST is expected to generate an additional revenue of RM10 billion annually starting next year," it said.
The ministry added that the government has taken into account public feedback and has revised the rates to exempt selected imported fruits such as apples, oranges, dates, and mandarin oranges.
"This decision was made to ensure continued access to nutritious and commonly consumed foods, particularly for vulnerable groups," it said. - NST
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