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Thursday, November 21, 2013

MCA backs GST but urges for corporate, income tax reduction

| November 12, 2013

Dr Chua Soi Lek says the government should gradually reduce corporate and income tax to assist the middle income group once the GST is implemented.

KUALA LUMPUR: MCA president Dr Chua Soi Lek advised the government to gradually reduce corporate tax and income tax once the 6 percent goods and service tax (GST) is enforced on April 1, 2015.

He said MCA agrees with the implementation of GST to broaden the government’s tax revenues but something should be done to assist the middle income group.

“We want the government to have a re-look at the income tax and corporate tax and to reduce it gradually with the implementation of GST.

“GST should also be maintained at 6% for the next five years,” he told a media conference after chairing the MCA central committee meeting today.

In the recently unveiled Budget 2014, Prime Minister Najib Tun Razak had pledged to reduce corporate income tax by 1% from 25% to 24%,and slash income tax by 1%-3% for all tax-payers.

Chua said that implementation of GST is necessary as only a limited number of people are currently paying tax.

“Assuming we have a 13 million workforce, only less than 15% of the people are paying tax.

“We feel that GST is fairer and more equitable in the long term. The more you consume, the more you pay, it can reduce incidents of tax evasion,” he said.

Today’s central committee (CC ) meeting was the first to be chaired by Chua after he lost his bid to pass a motion to censure his deputy and rival Liow Tiong Lai in the recent extraordinary general meeting (EGM).

Another motion allowing MCA members to assume federal cabinet posts was also rejected with a razor thin 10-vote majority.

Commenting on this, Chua said the current leadership will reintroduce the motion for MCA to rejoin the federal cabinet in the coming annual general meeting (AGM) to be held in December, but would leave it up to the new leadership to convene another EGM in order to discuss this specific topic.

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