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Monday, April 7, 2014

GST countdown

Published: Saturday April 5, 2014 MYT 12:00:00 AM 
Updated: Saturday April 5, 2014 MYT 6:40:03 AM

BASED on the Government’s target date of April 1, 2015, the countdown for the introduction of the goods and services tax (GST) reached the 12-month mark on Tuesday. Also, the GST Bill was tabled for first reading in Parliament on Monday and for second and third readings on Thursday.

That means there’s less than a year to go before the consumption tax becomes part of our daily lives.

This week was an excellent opportunity for the authorities to send a clear and strong message to businesses and consumers on the need to be ready for the GST. Unfortunately, that didn’t happen.

Yes, being one year away from the implementation is merely a line in the sand, and yes, the search for MH370 dominates the national consciousness, but a reminder at this point about the imminent arrival of the GST would be timely and effective.

People should be roused into action. And there’s indeed plenty to learn and do.

The replacement of the sales and service taxes with the GST is part of a major revamp of Malaysia’s tax system. The GST Bill is 163 pages long and the tax mechanism is by no means simple.

Businessmen and executives, in particular, should familiarise themselves with matters such as the value-added concept; the difference between zero-rated supply and exempt supply; input and output taxes; the GST Appeal Tribunal; and the various schemes under the proposed GST Act.

It’s not as if nothing is being done to prepare industries and consumers. The Royal Malaysian Customs Department has been holding seminars, talks and awareness programmes on the GST around the country, often with industry bodies. And we do see advertising that touts the benefits of the GST.

But is this enough? Come April 1 next year, will businesses and the rakyat be adequately prepared so that we can avoid confusion and costly mistakes?

For that matter, has the Customs Department built sufficient capacity and expertise to handle next year’s jump in transactions and enquiries? This is important because when it comes to showing urgency in preparing for new laws, the private sector takes its cue from the government.

With the clock ticking away and with so much at stake, the run-up to the GST can no longer be a low-key affair.

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