THE Federation of Malaysian Manufacturers (FMM) has welcomed the Government’s initiative to study the feasibility of reinstating the Goods and Services Tax (GST) and review the weaknesses of the existing Sales and Services Tax (SST).
Its president Tan Sri Soh Thian Lai said prices of Malaysian exports would be more competitive globally as no GST would be imposed on exported goods and services, while GST incurred on inputs could be recovered along the supply chain.
“Given the weak domestic and external environments brought about by the COVID-19 pandemic, we believe that priority should be given to strengthen the economy and restore more favourable business conditions,” he said in a statement.
As such, he said the Government should consult all stakeholders throughout the review process which been essential to the success of introducing an effective tax regime.
Besides that, Soh added the federation had carried out a survey pertaining to the reintroduction of GST in May involving 499 companies, which strongly supported the GST reintroduction and improved it to be more consumer- and business-friendly.
On Dec 10, Deputy Finance Minister II Mohd Shahar Abdullah said the Government will take into account various aspects to study the re-implementation of the GST, including weaknesses in SST which is currently in force, as well as those of the GST which was implemented in 2015.
He said the study will include impacts on the economy, the cost of living, the impact of taxes on the price of goods, as well as the ability to address shadow economy activities. – Dec 15, 2020.
