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Friday, November 15, 2013

GST will have ripple effects on M'sian society - expert

KUALA LUMPUR - The challenge of the goods and services tax (GST) is not in its introduction, but the actual implementation where it will create both positive and negative ripple effects on society, a tax expert said.

"The government is trying its very best to gain acceptability in GST, which is a losing battle as tax has never been acceptable to any tax-paying member of society," Taxand Malaysia Sdn Bhd co-founder and chairman Dr Veerinderjeet Singh said.

He said the government's tolerance towards industries will create problems.

"Some ministers have actually said that they are willing to listen to some industries for exemptions and if this is allowed, it will never end," Dr Veerinderjeet said.

"No one likes paying tax and asking for zero-rated items means that you pay nothing, the government gets nothing, and paying nothing is not good for the nation that's already in a critical state of fiscal deficit.

"As it is, the list of zero-rated items is already quite extensive and my concern is that this list will grow longer, given the political climate of this country," he explained.

Dr Veerinderjeet said by allowing breaks on personal tax and an extensive list of zero-rated items, it is inadvertently minimising the potential generated revenue of the GST.

"There will be a lot of complaints when the GST is implemented, due to limited knowledge on the tax itself and unscrupulous traders, who instead of recalculating their products and services, will just charge the additional six per cent for profit.

"For the consumer side, I suggest that the government start a hotline for complaints. Consumers should be able to pick up the phone and make complaints if they think traders are taking advantage through the GST. The government has to do their part by following these complaints in order to protect the Malaysians," he said.

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