by Anthony Aga, email@example.com. Posted on April 9, 2014, Wednesday
SARIKEI: A first glance at the Goods and Services Tax (GST) to be implemented in the country by April 1 next year shows that it is simply a change for the better compared to the present taxation system.
While the present system has two sales tax rates of five per cent and 10 per cent for specific goods and six per cent for services, GST on the other hand has a standard rate of 6 per cent for both goods and services, Sarikei Customs station chief Dr Alim Impira cited during a briefing session attended by representatives from various government departments and agencies at Sri Nyelong here yesterday morning.
“GST is indeed a move to restructure the country’s taxation system to be more efficient, effective, transparent, business-friendly and capable of generating a more stable income,” he added.
Despite its numerous plus points, it took many years of thorough study before the government decided to implement GST, he said.
According to records, the government indicated its interest to implement GST in 1983 by sending a team to South Korea to study its potential.
And five years later (1988), the then Finance Minister Tun Daim Zainuddin made it public that the government was considering to implement the GST.
In 1992, Datuk Seri Anwar Ibrahim who was the then Finance Minister announced GST in the 1993 Budget but it was later deferred and in 2004, then Prime Minister Tun Abdullah Ahmad Badawi mentioned about GST in his 2005 Budget speech saying that it was to come into effect on January 1, 2007.
In a follow-up to the announcement a team was sent to Australia, New Zealand and Indonesia to conduct further study on GST.
However, it was deferred in 2006 to give time to businesses to adapt to changes in processes and training of personnel.
In 2009, GST bill was read in Parliament and on October 28, 2013, Prime Minister Datuk Seri Najib Tun Razak declared GST of six per cent to commence from April 1, 2015.
By that time, Malaysia would be the 161st country in the world to implement GST, Alim said, adding, among the Asean countries only Malaysia, Myanmar and Brunei had yet to implement GST.
The six per cent GST rate is the second lowest among countries implementing the system, he said, with the lowest rate of five per cent and highest rate of 20 per cent implemented by United Kingdom.
As the implementation of GST is just about a year from now, Alim said it is imperative for people at
all levels to understand the system so that they know its real advantages over the present system.
In that respect, his department will continue to play its part by organising talks or briefings, he said.
According to Alim, they had already organised similar briefings for local community leaders and their next target group would be the business community.