PAC REPORT CONFIRMS HIS GUILT – YET SURREAL NAJIB CLAIMS HE HAS BEEN ‘VINDICATED’

Former prime minister Najib Abdul Razak (photo, above) today claimed he has been vindicated by the Public Accounts Committee’s report on the Goods and Services Tax (GST) refunds.

“I feel vindicated by the PAC report as there was no robbery or misappropriation of the GST collection.

“It is impossible there was misappropriation, it is impossible there was any robbery of the GST collection,” he told journalists at the Parliament lobby today.

While the PAC report concluded the GST money had not gone “missing” as claimed by Finance Minister Lim Guan Eng, it said Najib’s government had contravened the Goods and Services Tax Act 2014.

It said all GST revenue should be credited into the GST Trust Fund so that refunds can be processed within 28 days as required by law. Najib’s government had instead credited them into the consolidated revenue account.

The report also stated that the transfer from the consolidated revenue account to the GST Trust Fund was delayed and Najib’s government spent the money for operational and development purposes.

Attorney-general Tommy Thomas had said the routing of GST funds into a different account was a breach of the law.

However, Najib claimed the government acted on the advice of the accountant-general and Finance Ministry officials.

“The money was put into the consolidated account in full first. From there, we distributed it for GST refunds as the sum is not known, it depends on the validity of the claims.

“At the same time, we also used the money for management purposes such as government operations, services to the people and development.

“This is a suitable method and is also done by Singapore,” said the Pekan MP.

Spending the funds intended for GST refund left the government with a refund shortfall of RM19.4 billion.

The government subsequently asked Petronas to provide a one-off dividend to help pay the GST refund to businesses, some of which did not receive their refund for more than a year.

Guan Eng: PAC report confirms unlawful treatment of GST funds

KUALA LUMPUR – Finance Minister Lim Guan Eng insisted today that the Public Accounts Committee investigation triggered by his claim that Barisan Nasional (BN) “robbed” the country of RM19.4 billion confirmed the illegal use of tax revenue.

Lim said the now-repealed Goods and Services Tax (GST) Act had clearly mandated that collections be entered into a trust fund to allow input tax refund applications to be processed within 14 days.

“However, this was not done in accordance with the GST Act and instead, the GST collections were deposited directly into Consolidated Revenue Account.

“The attorney general has stated that this practice is against the fundamental trust law principles and trust accounting requirements, and is not in line with Section 54(2) and Section 54(5) of the GST Act 2014,” Lim said in a statement.

He said the BN government subsequently used GST collection booked as revenue in the Consolidated Account for expenses rather than input tax refunds, resulting in a shortfall and delayed refunds for GST input tax.

Lim further noted the PAC’s conclusion that the Najib administration only transferred 35 per cent of total GST collections back to the trust account when it should have set aside 42 per cent.

The minister was also adamant that this unlawful treatment of GST collections resulted in the RM19.4 billion shortfall, over which he made his “robbery” remark in Parliament last year.

He then held up the Customs Department’s confirmation last year that it owed RM19.4 billion in GST refunds due to insufficient funds as further evidence to support his position.

Lim then added that his ministry will adopt the PAC’s recommendations for the government to comply with existing laws in its financial administration and for officials to highlight regulatory departures without fear or favour.

However, the minister did not address the PAC’s conclusion that there was no theft or robbery involving GST revenue as he alleged.

The PAC tabled its investigation report to Parliament yesterday after investigating Lim’s allegation for 11 months since August last year.

– Malay Mail