Business group urges govt to reintroduce GST

 

The Malay Chamber of Commerce is urging the government to consider reintroducing the Goods and Services Tax (GST) that was scrapped in 2018.

Its president Norsyahrin Hamidon said the group believes GST is the most efficient tax regime in the world, with more than 174 out of 193 countries, or approximately 90 percent, having implemented GST.

“Many members of the public and entrepreneurs may not like GST, but it is the most efficient tax regime in the world. Many countries have adopted it, but Malaysia is one of the countries that has not implemented GST.

“Why? Because one thing to another, it will be subjected to tax. So, when there is no GST, the country's revenue - if I'm not mistaken - billions of ringgit will need to be borne again due to the loss of GST revenue.

“So, we ask the government to reconsider (the implementation of GST,” he said in a press conference in Kuala Lumpur today.

Without GST, Norsyahrin said the country would have to rely solely on individual and corporate income taxes.

Malay Chamber of Commerce president Norsyahrin Hamidon

The GST was introduced in 2015 to replace the Sales and Services Tax (SST) but proved highly unpopular. Pakatan Harapan reversed the policy as part of its election promises when it took power following the 2018 general election.

In its final year of implementation in 2017, the GST netted the government RM44 billion in revenue.

In 2019, a year after GST’s abolition, the government collected RM26.8 billion via SST which was reintroduced in its place. The SST rate was 10 percent on goods and six percent on services.

Despite calls from groups such as the Federation of Malaysian Manufacturers to reintroduce GST, Prime Minister Anwar Ibrahim told Parliament in February that the government has no plans to do so. - Mkini