We will explain benefits of higher revenue from GST, says Najib

Prime Minister Datuk Seri Najib Razak says the government is confident in its decisions over policies and the nation will see the benefits in the long term. – The Malaysian Insider pic, May 11, 2015.The government will explain and table to the people the benefits that they derive from the growth in national revenue, said prime minister Datuk Seri Najib Razak.

He said the government must find a stronger source of income for the country's finances by, among other things, introducing the goods and services tax (GST).

Najib said the government must be confident in making decisions although the outcome could not be seen in the short term but could only see the results in the long- and medium-term.

"The GST may not be popular in the short term. If possible, improve the tax implementation by taking action on irresponsible parties who raise prices and to give additional explanation to the people," he said at the monthly staff gathering of the Prime Minister's Department in Putrajaya today.

Najib, who is also the Finance Minister, said when the revenue increased, the government would explain to the people in a transparent manner because the people wanted to know the utilisation of the national income.

"Later, I will table to the people that we will use the additional revenue for the benefit of the people and country. This, I want to assure you that it is actually the government's aspiration.

"When our position is stronger, the market will have confidence in our national economy, we have additional resources, we can move ahead," he said.

Najib said the government had increased the 1Malaysia People's Aid (BR1M) this year to reduce the burden from the rising prices of goods, and reduced the rate of personal income tax.

"For us to do all these, we must have financial resources that can further strengthen the national income," he said, adding that he would table the 11th Malaysia Plan on May 21 which outlined the government's plans for the next five years.

Najib said that in order for the nation to be competitive with a high-income economy, the corporate tax must be reduced as was being done in Thailand and Singapore which had reduced it to 20% and 17% respectively in addition to the personal income tax.

The corporate tax rate in Malaysia currently is 25%.

Najib also drew attention to the fact that since he assumed the country's top leadership in 2009, the government had never failed to reduce the national deficit rate each year.

"When I took over the leadership, the national deficit was 6.6%. Every year, without fail and consistently, the deficit was reduced to the extent that the national deficit last year was only 3.5%.

"This shows that we are on the right track to achieve a balanced budget in 2020," he said.

Najib also said the government must be confident that what had been implemented had achieved the desired outcome and the national competitiveness had increased.

"Have faith that if we continue with what we are doing, improve the other weaknesses and work as a team, we will achieve our aspirations," he added.

- TMI