Posted on 14 November 2013 - 12:47pm
Last updated on 14 November 2013 - 07:52pm
KUALA LUMPUR (Nov 14, 2013): The government is likely to form the Goods and Services Tax (GST) Monitoring Committee before year-end, Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah said today.
The committee, to be chaired by Husni, is being established to ensure the smooth implementation of the GST with members from government agencies as well as representative from industries and non-governmental organisations.
He was speaking to reporters this on the sidelines of the Business Times Insight, "GST: Are Malaysians Ready?" breakfast talk here today.
The GST is an integral component of a strategic fiscal reform package to fulfil a fundamental long-term structural evolutionary process of the national economy.
Announced by Prime Minister Datuk Seri Najib Tun Razak during the tabling of the Budget 2014 last month, the single tax GST which replaces the existing sales and service tax, will come into force on April 1, 2015, at the rate of 6%.
The GST is currently implemented in more than 160 countries, including less developed ones, at rates of between five to 27%. All countries in Asean have implemented the GST, except Brunei, Myanmar and Malaysia.
According to Husni, of all the countries that have implemented the GST, seven had rated it at 5%, six at 7% and the remaining at more than 10%.
"In countries that introduced the GST from 2010 onward, the minimum rate charged was at 12%.
"Under the current economic climate, we consider the 6% rate as being the lowest," he said.
Earlier in his address at the talk, Husni said with the implementation of the GST, Malaysia can remain competitive in the global markets.
At the same time, he added, the country can attract and retain sufficient talent to take it to the next level of economic development, as well as become an innovation nation embracing high productivity.
"In an increasingly competitive foreign direct investment climate, with more and more countries integrating themselves into the global economy, it is better for us to offer a lower, transparent certainty in our tax regime, and do away with cumbersome and bureaucratic exemptions, tax holidays and relief.
"The GST provides a comprehensive solution to these issues in so far as the Treasury's revenue is concerned," he added. – Bernama