WITH the Government mulling to reintroduce the Goods and Services Tax (GST), a non-governmental organisation (NGO) urged the former to reconsider the plan.
“Malaysia has just entered the transition to endemic phase. While the economy is showing signs of recovery but we are not at the situation where things are back to normal in every sphere of life.
“In case the Government has forgotten, many in the tourism industry, such as hotels, have shuttered down for good. Thousands are still unemployed including pilots and flight attendants.
“So, with our economy still ‘limping’ towards a full-fledged recovery, imposing a new tax regime on an already suffering populace is a dumb move,” Malaysian Indian Voice (MIV) chairman V Pappa Raidu told FocusM.
On May 31, Prime Minister Datuk Seri Ismail Sabri Yaakob told a Japanese media that he was not in a hurry to call for snap polls given the rise in food prices and economic uncertainties.
However, he told Nikkei that the Government was considering to reintroduce the GST to bring in additional revenue to the nation’s coffers.
“The Government would target a GST rate that does not burden the people, but is not so low that it ‘defeats the purpose of expanding tax revenue’,” he was reported as saying.
On April 2015, then-prime minister Datuk Seri Najib Tun Razak introduced the GST at a 6% threshold. However, he exempted numerous essential goods from the consumption tax.
Soon after taking over Putrajaya in 2018, Pakatan Harapan scrapped the GST and reintroduced the Sales and Services Tax (SST). However, the decision received criticism from several experts as the country lost about RM20 bil in additional revenue.
Curb graft first
On that note, Pappa Raidu reminded Ismail Sabri that what Malaysia needs to do was to instill confidence among investors, local and international, so as to boost the economic recovery.
As of now, he lamented that investors were taking their money to countries like Singapore, Vietnam and Indonesia due to their consistency and sound policies, with little red tape.
“But here, we have a political instability that is only driving investors out. When it comes to business, uncertainty is a bad word,” he mentioned.
Back to GST, Pappa Raidu urged the Government to address corruption and leakages that is plaguing Government agencies first before trying to take money from an already struggling masses.
“And our Government have this tendency of overspending for the simplest projects. Let us trim the unnecessary public expenditures first before imposing a new tax regime.
“Who knows? Maybe after making prudent spending our way of life, we may actually have more money in our coffers that GST may not be necessary at this juncture,” he concluded. – June 4, 2022
