Hazy about GST

BY HARESH DEOL

JUNE 28, 2013

KUALA LUMPUR, June 28 ― Consumer groups want the government to make a stand over the implementation of the Goods and Services Tax (GST) which has now been shelved pending further studies.

The groups claim thorough studies should have been conducted before the government’s announcement to introduce GST.

“Why propose something if no proper studies were done in the first place? It is akin to testing waters,” said Muslim Consumer Association Malaysia (PPIM) executive secretary Datuk Nadzim Johan.

“We are not against the GST but we need to know the details and till today we don’t know what are the mechanics of the GST that will be adopted in Malaysia. Are we going to use the Singapore model? What is the percentage of GST? So how can we agree to something which remains unclear till today?” he asked.

Nadzim said the GST had its pros and cons but the government needed to be firm in deciding what it wanted and how it would want to introduce GST.

“The GST needs to be thought with the country in mind and not turn it into a political issue. Sadly, some quarters are still turning such important matters into a political issue which is not good for the nation,” he said.

“It doesn’t matter if the government decides to shelve today or announce the implementation of the GST ahead of the tabling of the Budget. What is more important is that the government needs to have clear guidelines.”

Federation of Malaysian Consumers Associations (Fomca) secretary-general Datuk Paul Selvaraj admitted the GST was important for the nation to generate income.

“But the importance and relevance of the GST must be seen,” Selvaraj said.

He said the GST would be another form of revenue for the government as it was too heavily reliant on petroleum which was a depleting resource.

“The government should communicate the workings of the GST to the rakyat as many remain sceptical of its benefits,” he said.

“There should be transparency and only then it will gain the trust of the people and to see the money (obtained from GST) put into good use.

“Fomca admits it is sensitive and unpopular but we need a bipartisan agreement for the good of the country. Let’s look beyond the politics.”

Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah had, during Question Time in Parliament yesterday, said the government had not made any decision to implement the GST and had yet to determine a GST rate.

There was a desire by the government to implement the GST in 2007 and the Bill was tabled for first reading a year later only for it to be retracted as the studies done based on the prices of goods then showed it was “not suitable to make a decision”.

Most nations around the world including Singapore, India, China and the European Union have implemented the GST or also known as Value Added Tax (VAT).

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