Nuffnang Add

Monday, April 7, 2014

Need for govt to intensify GST awareness programme

07 April 2014| last updated at 02:35AM

WITH only 12 months to go before the goods and services tax (GST) kicks in, the government must intensify promotional activities among the people to boost awareness of the new tax system.

At the Goods & Services Tax Seminar 2014 organised by the Malaysian Financial Planning Council and Financial Planning Association of Malaysia in Kuala Lumpur last month, it was evident that some participants didn't know who is in charge of the new tax regime.

During the question-and-answer session, a participant had wanted to know how the Inland Revenue Board (IRB) will go about monitoring and collecting the GST.

But the IRB will not be collecting the GST. It is, in fact, the task of the Customs Department.

To find out more about GST, the public can go to the Customs' website. Any new information on the subject will be regularly updated there.

Another participant, meanwhile asked whether he will get personal income tax breaks if he pays the GST.

Yes, Malaysians will get personal income tax breaks once the GST is implemented.

Some don't even know that the GST is consumption-based - meaning, the more you use or buy products or services, the more tax you have to pay.

Such misconceptions and lack of information should not be happening at this stage.

The government must do something to enhance awareness as the information that is trickling out is insufficient.

This will affect planning activities by financial planners when advising their clients.

Another example is that under GST, all supplies will fall under four categories, which are:

* Standard rated

* Zero rated

* Exempt

* Out-of-scope

But this is too technical for the layman.

As for business organisations that do understand the terms, currently there is no finalised list of the standard rated, zero rated, or exempt items/services, which is causing confusion among businesses and the public.

However, it is heartening to know about the setting up of a GST refund body, as announced by Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah in Parliament last Friday.

He said the GST refund body will ensure a smooth refund process, similar to the one put in place by the IRB, which handles tax refunds for individuals and businesses.

According to the GST Bill 2014, the refund will be given within 14 working days if the tax forms are done electronically, or 28 days if done manually.

The GST seminar is the first of many campaign blitzs that the government needs to step up to ensure that the implementation of GST will start smoothly come April 1 next year.

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