JANUARY 27, 2014
|A vendor hangs clothes to sell near Cherating beach, |
outside Kuala Lumpur November 15, 2013. — Reuters pic
KOTA KINABALU, Jan 27 — The government decided to implement the Goods and Services Tax (GST) not to reduce the country’s debts, says Deputy Finance Minister Datuk Ahmad Maslan.
He said the government was repaying its debts promptly every year.
“Our debts are under control. The composition is made up of 97 per cent local debts and only three per cent comprise foreign loans. As such, we are not at the mercy of other nations. Our debts are about RM540 billion.
“We are keeping up our payments every year, there is no problem and the people will not be burdened with the debt as the government is honouring its debts obligation through the annual budget,” he told participants during a question and answer session at a seminar on empowering the national economy.
Ahmad said the government had set a national debt ceiling of 55 per cent of Gross Domestic Product (GDP) and the current debt level stood at 53.7 per cent of GDP.
“In some countries, the national debt level is 100 per cent of GDP and at an alarming 200 per cent in other countries.
On oil prices, Ahmad said during former prime minister Tun Dr Mahathir Mohamad’s administration, crude oil was fetching US$40 million per barrel and the subsidy was US$2 billion a year but today oil prices have spiralled to US$100 per barrel and the government was subsidising RM2 billion every month.
He said money saved from diesel and petroleum subsidy rationalisation was now used to channel funds to target groups especially in the form of 1Malaysia People’s Aid programme.
Ahmad also denied that Malaysia had slipped into a recession as economic growth for this year has been forecast to grow between 5 per cent and 5.5 per cent.
He said a country was in recession if economic growth was negative for two consecutive quarters. — Bernama