Nuffnang Add

Wednesday, April 2, 2014

No tax on govt goods

Publication: NST
Date of publication: Apr 1, 2014
Section heading: Main Section
Page number: 020
Byline / Author: By Zarina Zakariah; Hana Naz Harun

KUALA LUMPUR: CONSUMPTION tax will not be levied on goods and services offered by the government, local authorities and statutory bodies under the Goods and Services Tax (GST) Act, when it takes effect from April 1 next year.

This would apply to any supply of goods and services made by the federal and state governments as well as local authorities and statutory bodies in regards to regulatory and enforcement duties.

Services under this category include transport, education, housing, health and financial goods and services.

The first reading of the bill was tabled in the Dewan Rakyat yesterday by Deputy Finance Minister Datuk Ahmad Maslan.

He said although the percentage of the GST was not fixed in the bill, the government had determined it would be six per cent as announced by Prime Minister Datuk Seri Najib Razak in the 2014 Budget last year.

"By replacing the 10 and five per cent government and sales and services tax (SST) to GST at six per cent, we can reduce tax redundancy and provide a more structured taxation system.

"The GST will only be levied on goods and services provided by businesses with a capital threshold of RM500,000 and above, in addition to imported goods. Next year, we will be introducing some measures to reduce the impact of the GST towards a targeted subsidy system."

The 1Malaysia People's Aid (BR1M 4.0) would see an increase of of RM300 as well as tax reductions of between one and three per cent on all taxable groups.

"Malaysia has the lowest tax rate among Asean countries, compared with seven per cent in Singapore and Thailand, and 10 per cent in Indonesia, the Philippines, Laos, Vietnam and Cambodia."

GST payment failure would see offenders fined between 10 and 20 times the amount of tax evaded, provisions in the bill specify.

The provisions also noted that those found guilty would be subjected to a maximum jail sentence of five years or face both a fine and imprisonment.

A tax evasion repeat would see the fine doubled. Offenders would have to pay between 20 and 40 times the amount of tax evaded, and could be jailed up to seven years, or both.

If the amount of tax evaded cannot be ascertained, offenders would be liable to a fine between RM50,000 and RM500,000, or seven years' jail, or both.

Other exceptions to the GST would see retail trade activities approved under the Free Zones Act 1990 and located within free commercial zones also enjoying tax-free supply of goods and services.

Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah is scheduled to table the 2014 GST Bill for the second reading next Monday.

No comments:

Post a Comment