GST money not returned? We’ll tell all, says Guan Eng

KUALA LUMPUR: The Finance Ministry will reveal how much money was not returned to manufacturers under the Good and Services Tax (GST) regime, says its minister Lim Guan Eng (pic).

“In due time, I will be exposing why GST refunds were not returned to manufacturers and the total amount involved,” he said during Question Time at the Dewan Rakyat on Thursday (July 19).

Lim said that the failure to refund GST claims to manufacturers had resulted in an increase in the cost of goods.

“The problem was that they (manufacturers) did not get their GST returns which resulted in the cost of goods constantly rising,” he said when responding to Datuk Ahmad Maslan (BN-Pontian), who had claimed that some manufacturers had cheated when making GST refund claims.

On the scope and threshold of the Sales and Services Tax (SST) to be implemented Sept 1, Lim said this will be explained in detail when the Bill on SST is tabled in Parliament.

To a question raised by Datuk Seri Dr Wee Ka Siong (BN-Air Hitam), Lim said that the SST would only apply to 38% of selected goods and services, compared with the GST which taxed some 60% of basket goods and services and was a “cradle to grave” tax regime.

For example, he said dairy products, sardine, tea, chilli and tomato sauce, kaya, margarine, bicycles and motorbikes below 250cc would no longer be taxed under the SST, unlike with the GST.

However, Lim acknowledged that there would be some impact following the reintroduction of the SST, which he also admitted was less transparent and efficient compared with the GST.

“We are not denying the reality that there will be an impact.

“But what is important is that the impact of the SST is half of the GST which had burdened the rakyat,” he said.

He noted that some RM44bil in revenue was collected through the GST compared with the RM21bil estimated from the SST.

“It means that we will be collecting RM23bil less with the SST and this could be considered as a gift to the rakyat,” he said.

Lim said that he has directed the Customs Department to plug any loopholes that businesses may use to avoid paying the SST when it is reintroduced.- Star