Husam shares docs of purported GST relief for ECRL's China contractor

Amanah vice-president Husam Musa today disclosed documents which purportedly showed that China Communications Construction Company (CCCC), the contractor for the East Coast Rail Link (ECRL), was granted a relief from paying goods and services tax (GST).

The document was a certificate of GST relief for the acquisition of goods and services for the ECRL project and issued in the name of China Communications Construction (ECRL) Sdn Bhd.

The certificate said the relief was granted under Section 56(3)(a) of Goods and Services Tax Act 2014 which concerns the finance minister's power to grant GST relative.

Section 56(3)(a) reads: "The minister may, in any particular case and subject to such conditions as he deems fit to impose - relieve any person or class of persons from the payment of the whole or any part of the tax which may be charged and levied on any taxable supply of goods and services or any importation of goods or class of goods".

Husam shared the certificate on Facebook this afternoon and the post had garnered more than 800 shares in six hours.

The certificate was accompanied by a letter carrying CCCC's letterhead informing its supplier that it was granted the GST relief based on a letter by the Finance Ministry dated Feb 7 this year.

It added that the GST relief was effective Sept 26, 2016.

"How true is this? China company being granted GST relief. I request that the Finance Ministry explain," Husam said in his Facebook post.

Royal Malaysian Customs director-general Subromaniam Tholasy, when contacted, said his department will address the matter.

"We will issue an official statement tomorrow," he told Malaysiakini.

A government source told Malaysiakini that there was nothing wrong about the GST relief as imposing GST will drive up the cost of the ECRL project which is ultimately footed by Putrajaya.

The government is financing the approximately RM60 billion project through a soft loan from the Export-Import Bank of China and debt raised in the bond market.

Around 600km in length, the ECRL will link up Port Klang with key cities on the east coast of Peninsular Malaysia including Kuantan, Kota Bharu and Kuala Terengganu. - Mkini