Published: 2013/10/12
THE goods and services tax (GST) will be beneficial for the country after it has its period of stabilisation, said Tax and Malaysia Sdn Bhd chairman Dr Veerinderjeet Singh.
"GST, in the future, will generate more revenues and reduce the country's budget deficit," he said during a public lecture at Universiti Malaya, here, yesterday.
"Ideally, the stabilisation period will take two to three years."
The public, he added, can expect lower prices of essential items from big retailers with the GST implementation.
"Certain big retailers, like the hypermarket operators, can expect a potential increase in profit margins from the GST implementation.
"By lowering the prices, they will be able to gain more profits. The public will benefit from the price reduction."
Veerinderjeet felt that individual and corporate income taxes should not be reduced as the country still needs funds to cover the deficit.
"It is not a great time to reduce the income tax on individuals and companies when we need it the most."
He stressed that handing out cash to the lower income group is detrimental in the long run.
"We can give cash handouts for one or two years, but we can't give it every year.
"We don't have the funds for it, where will it end and who really is paying for it?"
Veerinderjeet suggested that cash handouts should be replaced with vouchers to curb misuse.
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