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Wednesday, January 8, 2014

Rafizi: KPMG affirms negative impact of GST

| January 8, 2014

KPMG's call for employers to gradually increase the salaries of their employees reflects negative impact of GST implementation, says Pandan MP.

PETALING JAYA: KPMG Malaysia’s call for both the public and private sectors to gradually increase the salaries of their employees affirms the negative impact of the the imposition of the goods and services tax (GST) in April 2015.

Pandan MP Rafizi Ramli was today responding to KPMG’s newly-appointed managing partner Johan Idris’ suggestion yesterday that a 6% increase in employees’ salaries per annum to help tide over the high cost of living in Malaysia.

“All this while the government has misled public into thinking there is no negative impact of GST,” Rafizi told a press conference here.

“I laud the statement by Johan that certainly there will be a price increase. This reflects the true sentiments of the people all along that that it (GST) will be implemented without a salary hike,” he added.

Rafizi stressed that as long as the government does not take adequate steps to increase the salaries of workers, GST cannot be implemented.

“Salaries of workers must be increased gradually until the average household income reaches a reasonable level, then only can GST be implemented,” he said.

“PKR has long suggested that the average household income must be RM4,000 a month before GST can be considered,” he added.

Putrajaya spent RM200 million on GST campaign

The PKR strategic director then slammed Putrajaya for spending RM100 million to build a software system – MyGST – to implement its new tax policy.

“Furthermore, this system will be pushed down the throats of our small traders. In turn, the people will have to cover the cost of this unnecessary software system,” he said.

“I don’t know what rules they will implement but hope they will not make it compulsory to use MyGST if it is expensive,” he added.

Rafizi further criticised Finance Ministry’s Assistant Secretary-General of Taxes Khairul Annuar Osman’s recent announcement that the government had allocated RM100 million to conduct campaigns and trainings on GST.

“They are spending RM100 million on a campaign. Surely a campaign to introduce GST would not amount to such an astronomical figure,” he lamented.

“They should come to me instead, I would conduct their campaigns for much less than RM100 million,” he said in jest, prompting laughter from members of the media.

“The finance minister should be held responsible for such exorbitant spending, which should be reduced immediately especially when the people are faced with increased cost of living.”

Yesterday, Johan reportedly said a 6% increase in salaries would be a good example to begin with especially after the GST implementation, new electric tariffs, petrol subsidy cuts and new toll rates.

Johan said that the GST implementation was inevitable as Malaysia was a developing country.

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