Saturday, October 12, 2013

Penang Institute: GST is not the only way to raise revenue

By Fatin Rasyiqah Mustaza of theedgemalaysia.com | Business | The Edge Malaysia – Wed, Oct 9, 2013

KUALA LUMPUR: While some quarters have called on the government to speed up the implementation of the goods and services tax (GST) to increase revenue and address the budget deficit, another group has questioned whether the GST is the only means of meeting the twin targets.

The Penang Institute yesterday said there are other methods besides introducing the GST.

Executive director Datuk Dr Woo Wing Thye advocated a rise in taxes and increasing the government’s efficiency in managing its expenditure to rein in the worsening deficit.

“There is room for efficiency in government spending,” he said, adding that if the government practises open tender procurement it could lower its expenditure by 30%.

Woo told a Penang government forum on GST & You yesterday that action should be taken against certain parties mentioned in the Auditor-General’s reports should there be any inconsistency or inaccuracy.

“We only do something when the Auditor-General’s report is out, which is after the roof has fallen down. Before an event occurs, we should practise open tender as well as inspect or monitor ongoing projects,” he said.

Woo said government linked-companies and state investment agencies should contribute more of their retained profits to the government’s revenue base in the form of dividends.

His colleague at the Penang Institute, Dr Lim Kim-Hwa, said the GST would burden the middle-income group the most.

With an average GST of 7%, he said the middle-income households would have to fork out at least RM104 a month to pay for taxes, representing 2.93% of their total income.

Lim said the GST would heavily weigh on consumer goods, restaurants and hotels as well as transport. Healthcare, food and non-alcoholic beverages would have the lowest GST rate.

He said it is possible to raise the same amount of RM7 billion in revenue per annum, while making the GST less regressive at the same time.

According to Lim, the GST could be implemented in a multi-tiered structure and the tax imposed on only selected items. Income tax rates could also be lowered and refundable tax credits be allowed.

“This is difficult though, as the middle-income groups will still pay higher GST than the higher-income group,” he said.

This article first appeared in The Edge Financial Daily, on October 9, 2013.

Friday, October 11, 2013

Budget 2014 to focus on reducing fiscal deficit, building resilience: Najib

OCTOBER 10, 2013

The Budget 2014 to be tabled on Oct. 25 will focus on reducing the fiscal deficit and enhancing national resilience, said Prime Minister Datuk Seri Najib Razak.

Najib (pic), who is also Finance Minister, said strengthening the national economy would enable Malaysia to be more resilient and achieve reasonable growth in an uncertain global economy.

"We will focus on strengthening our economy so that we can last. One important element is enhancing national resilience," he told Malaysian journalists covering the 23rd Asean Summit and Related Summits which ended in Bandar Seri Begawan, Brunei today.

He was responding to a question on whether the fiscal standoff in the United States, which has to resolve its debt ceiling issue by Oct. 17, had been taken into account in Budget 2014.

Najib said the situation regarding the standoff is fluid and a compromise could be reached at the last minute.

"That's what we are hoping for (a compromise), but whatever the outcome, we hope America's growth is not affected or, even worse, its economy crashes," he said.

Najib said an American economic crisis could affect global economic growth, making it difficult to predict what would happen next.

On the request by the Congress of Unions of Employees in the Public and Civil Services (CUEPACS) for a two-month bonus and higher allowances for 1.4 million civil servants this year in the wake of the recent fuel subsidy cuts, Najib said the matter should be further studied in detail.

"I don't want to say anything now. I have to look at the government's accounts first. We are on track to reduce the fiscal deficit, and we want to complete whatever programmes for the people's well-being," he added.

Najib said leaders at the Summit took note of the current global economic situation, with trade seen growing at a slower rate in 2013 and global economic growth at around three per cent.

However, he said, the good news is the Asia Pacific region emerging as the fastest-growing region, making it the world's growth engine.

"In my intervention, I stated the need to be given clear signals on the quantitative easing to be carried out by the United States, especially by the Federal Reserve. But the timing and total amount to be involved in the quantitative easing are not clear, contributing somewhat to the volatility in emerging economies," he said. – Bernama, October 10, 2013.

Cutting budget deficit seen among key focus of Budget 2014

Published: Friday October 11, 2013 MYT 12:00:00 AM

Updated: Friday October 11, 2013 MYT 7:57:55 AM

PETALING JAYA: The key focus of Budget 2014 would be on fiscal prudence towards reducing the budget deficit to 3% of gross domestic product, a balanced budget by 2020 and policy reforms to make Malaysia a global competitive economy, said Alliance Research.

Alliance Research economist Manokaran Mottain said in a report that the focus would also be on improving the quality of life of the people, while ensuring sustainable growth. The goods and services tax (GST) would likely be implemented in 2015, as preparation would take at least 12-18 months.

“Budget 2014 would focus on a balanced and quality growth, while maintaining price stability amid the rising cost of living, as well as maintaining fiscal consolidation with more bold policy reforms to raise the country’s competitiveness and efficiency.

“The Government would also be realistic on its growth targets, which we expect to range between 4.5% and 5.5% in 2014,” he said.

Manokaran said the Government would be committed to addressing the persistent and long-standing fiscal strains on its coffers.

The research house estimates that the budget deficit for 2014 would be trimmed further to 3.5%, from an estimated 4% in 2013. With the sequencing of some of the low-multiplier and high import-content projects under the Economic Transformation Programme, Alliance Research is confident this would reduce the risk of Malaysia slipping into a current account deficit.

In addition, the recent fuel subsidy cut of 20 sen would help the Government save RM1.1bil in 2013 and RM3.3bil in 2014. “Beyond this, we expect an additional subsidy cut of 20 sen per litre for RON95 and 10 sen per litre for diesel over the next six months,” he said.

Manokaran expects the Government to announce a timeline for the implementation of the GST in 2015, as it may need a period of 12 to 18 months for the parliamentary processes before it is legislated.

“We opine that the ideal rate for the GST for a start could likely be between 4% and 5%, with some essential items and services being exempted. While we are hopeful that the Government might reduce corporate and personal income taxes, we do not expect to see any reduction in 2014, in view of our expectations that the GST would only be implemented in 2015,” he added.

Alliance Research expects the ceiling for the 1Malaysia People’s Aid (BR1M) to be increased to RM5,000. The Government provides the BR1M for households earning a monthly income of less than RM3,000.

“We expect a full-year growth of 4.5% in 2013, at the lower end of Bank Negara’s revised forecast of 4.5% to 5% in 2013.

“For 2014, we expect growth to pick up to 5%, underpinned by robust domestic demand and improving external conditions,” Manokaran said, adding that he forecast an inflation target of 3.2% in 2014 due to the impact of further subsidy cuts.

Kebergantungan negara kepada hasil petroleum menurun

Kebergantungan-negara-kepada-hasil-petroleum-menurun#ixzz2hMqt2y4c

Pelaksanaan GST masih dalam kajian - Wahid

KUALA LUMPUR 10 Okt. - Kerajaan sedang menjalankan kajian berkaitan sistem cukai barangan dan perkhidmatan (GST) bagi menilai impaknya terhadap kadar inflasi dan kaedah terbaik pelaksanaannya, kata Menteri di Jabatan Perdana Menteri, Datuk Seri Abdul Wahid Omar.

Menjawab soalan Senator Khairiah Mohamed yang ingin tahu bilakah kerajaan akan memperkenalkan GST, Abdul Wahid memberitahu Dewan Negara pada Khamis, bahawa tarikh pelaksanaannya masih belum ditetapkan.

Beliau menjelaskan, pelaksanaan GST bagi menggantikan cukai jualan dan cukai perkhidmatan, merupakan satu daripada pendekatan jangka panjang kerajaan bagi meningkatkan hasil pendapatan negara.

"Cukai ini lebih komprehensif mencakupi hampir semua barangan dan perkhidmatan berbanding cukai jualan dan perkhidmatan yang tertakluk kepada paras nilai yang tertentu," katanya.

Beliau berkata, antara langkah lain untuk meningkatkan hasil negara ialah melalui syarikat minyak negara, Petronas yang akan terus meneroka potensi baharu di sektor berkaitan bagi mengekalkan tahap produksi minyak dan gas negara.

"Jumlah hasil petroleum meningkat daripada RM66.3 bilion pada 2011 kepada RM70.1 bilion pada 2012.

"Setakat Januari 2013, negara mempunyai rizab minyak berjumlah 5.85 bilion tong, dan ini berdasarkan kepada pengeluaran kita iaitu secara purata 600 tong sehari.

"Jadi jangka hayat sumber minyak kita adalah lebih kurang 27 tahun lagi," katanya.

Abdul Wahid berkata, kerajaan juga sedang berusaha meningkatkan aktiviti ekonomi domestik menerusi pelaksanaan projek utama di bawah Program Transformasi Ekonomi. - BERNAMA

Artikel Penuh: http://www.utusan.com.my/utusan/Dalam_Negeri/20131010/dn_36/Pelaksanaan-GST-masih-dalam-kajian---Wahid#ixzz2hMqawUNb

Pelaksanaan GST masih dalam kajian: Abdul Wahid

2013/10/10 - 14:53:21 PM

KUALA LUMPUR: Kerajaan sedang menjalankan kajian berkaitan sistem cukai barangan dan perkhidmatan (GST) bagi menilai impaknya terhadap kadar inflasi dan kaedah terbaik pelaksanaannya, kata Menteri di Jabatan Perdana Menteri, Datuk Seri Abdul Wahid Omar.

Menjawab soalan Senator Khairiah Mohamed yang ingin tahu bila kerajaan akan memperkenalkan GST, Abdul Wahid memberitahu Dewan Negara hari ini, bahawa tarikh pelaksanaannya masih belum ditetapkan.

Beliau menjelaskan, pelaksanaan GST bagi menggantikan cukai jualan dan cukai perkhidmatan, merupakan satu daripada pendekatan jangka panjang kerajaan bagi meningkatkan hasil pendapatan negara.

"Cukai ini lebih komprehensif mencakupi hampir semua barangan dan perkhidmatan berbanding cukai jualan dan perkhidmatan yang tertakluk kepada paras nilai yang tertentu," katanya.

Beliau berkata, antara langkah lain untuk meningkatkan hasil negara ialah melalui syarikat minyak negara, Petronas yang akan terus meneroka potensi baharu di sektor berkaitan bagi mengekalkan tahap produksi minyak dan gas negara.

"Jumlah hasil petroleum meningkat daripada RM66.3 bilion pada 2011 kepada RM70.1 bilion pada 2012.

"Setakat Januari 2013, negara mempunyai rizab minyak berjumlah 5.85 bilion tong, dan ini berdasarkan kepada pengeluaran kita iaitu secara purata 600 tong sehari.

"Jadi jangka hayat sumber minyak kita adalah lebih kurang 27 tahun lagi," katanya.

Abdul Wahid berkata, kerajaan juga sedang berusaha meningkatkan aktiviti ekonomi domestik menerusi pelaksanaan projek utama di bawah Program Transformasi Ekonomi.

- BERNAMA

More bad news looming

Published: Thursday October 10, 2013 MYT 12:00:00 AM

Updated: Thursday October 10, 2013 MYT 11:40:39 PM

BY STEPHEN THEN

OVER the past few days alone, I have heard about the plight of another three families in Miri who are asking for help because they are facing extreme financial difficulties.

These are all needy people, people who are poor and who have little savings.

They are desperately seeking financial assistance from kind-hearted donors and from welfare authorities because they are struggling to cope, living hand to mouth everyday.

I have just spoken to Miri Welfare Department head Goh Yong Kiet about their plight.

Goh is a very understanding person, always willing to listen and offer advices and suggestions on what can be done to help these people.

He has proposed certain steps to take to look into the needs and perhaps try to secure financial aid for the latest needy families I met.

People have been hit very hard by financial difficulties arising from the current economic situation in the country.

The unfortunate thing is that there are some more bad news looming in the horizon.

Even as we, the ordinary citizens, are reeling from the multiplier effects of the price increase caused by the Government’s decision to reduce subsidy of fuel in September, we will have to brace ourselves to face even more difficult times before the year comes to an end.

I have just found out that the prices of certain electrical items have shot up and will be increased again from next month.

I am not sure if this is happening in Miri city only or if the increase in prices of electrical items are happening or about to happen in other parts of Sarawak and other parts of Malaysia.

Whatever it is, the prices of certain brand of electrical items here will be increased, perhaps by as much as RM100, starting next month, that was what I had been told.

Apart from the prices of electrical items, the prices of consumer products made from sugar and flour may see an imminent increase soon, perhaps next month.

This is because of the anticipated reduction of government subsidies for flour and sugar that may be proposed very soon — maybe later this month by Putrajaya.

This means that there is a possibility that the price of essential food items that we have for breakfast such as noodles and bread may see further increase.

Already, over the past month alone in Miri City, the prices of noodles had increased by up to 50 sen in certain eateries.

A glass of coffee had already been increased by 20 sen while certain coffeeshops had marked up the price of milk-flavoured drinks by as much as 50 sen.

Some of these eateries are also charging an extra 50 sen for pork dishes, while others have increased the price of certain chicken dishes by RM1.

Miri city is indeed living up to its reputation as the most expensive urban centre in Sarawak, if not in the country.

If that is still not bad enough for the people in the city, the Miri City Council is said to be preparing to impose an additional 2% increase in the assessment rate for house owners.

It is said that the council had already outlined a blueprint for this increase, which is expected to be enforced early next year.

The council is also planning to impose a mandatory de-sludging of septic tanks for every building and house in Miri city.

Each desludging operation may cost RM400 to RM500 for every building.

I spoke to some city councillors two days ago and was informed that another controversial decision may be made soon that may see parking fees in Miri city going up.

The city council may go ahead with its plans to privatise the management of parking bays in Miri. It wants to hand over the management of public parking system to a private company.

That may mean an imminent increase in parking fees for the city’s population of 350,000.

The things I mentioned above are just some of the looming bad news.

At the national level, it is said that the Government is going to try out the imposition of the Goods and Services Tax (GST).

It is said that the GST will be officially endorsed soon, maybe during the coming Budget 2014 that will be tabled in Parliament before end of this month.

If the GST is introduced and enforced, the charges for many types of goods and services are expected to be raised considerably.

Already the prices of steel products had shot up.

Imported steel items brought in from Peninsular Malaysia to Sarawak have cost more and this had already led to an increase in the costs of construction charges in housing estates and commercial areas throughout Sarawak.

Housing developers had said they had no choice but to raise the price of newly built units.

At the national-level too, there are talks that certain major companies are carrying out downsizing exercises.

They are reducing the number of staff as part of measures to contain rising overhead expenditures.

To reduce spending on the payment of salaried workers every month, they are looking at automation, and are therefore offering certain categories of employees voluntary separation schemes.

Those employees willing to leave are offered compensation packages.

This downsizing exercise may affect a considerable percentage of workers, thereby increasing the overall unemployment rate, at least for the short-term.

Some of these companies operating at the national level have branches in Sarawak too, so Sarawakians will also be affected.

It is not very clear how many companies in Sarawak are going to opt for retrenchment or voluntary separation schemes. But it is a fact that there are many that are not registering the profit margin they had hoped for and may go for downsizing as a last resort to stay afloat.

So folk, looks like the remaining months of this year may see more misery and difficulties.

There are at least half a dozen types of bad economic and financial news coming and they may hit us smack in the face and burn whatever is left in our pockets before we can say bye-bye to 2013.

Implementation of GST still being studied

Posted on 10 October 2013 - 05:50pm

Last updated on 10 October 2013 - 07:59pm

KUALA LUMPUR (Oct 10, 2013): The government is conducting studies on the goods and services tax (GST) system to gauge its impact on inflation rates and find the best way to implement it, said Minister in the Prime Minister's Department Datuk Seri Abdul Wahid Omar.

Replying to a question from Senator Khairiah Mohamed on when the government would introduce the GST, Abdul Wahid told the Dewan Negara today that the implementation date was not set yet.

He said the GST, which would replace the sales tax and service tax, was one of the long-term approaches taken by the government to increase national revenue.

"This tax is more comprehensive, covering almost all goods and services compared to the sales and service tax which is subjected to a certain value level," he said.

"One of the ways to increase revenue is through the national petroleum company, Petronas, which will continue to explore new potential in relevant sectors to maintain the country's gas and petroleum production levels.

"Petroleum revenue increased from RM66.3 billion in 2011 to RM70.1 billion in 2012. "Meanwhile, as of January 2013, the country had an oil reserve of 5.85 billion barrels and this was based on our production of an average 600 barrels per day.

"So, the lifespan of our oil supply is about 27 years more," he said. Abdul Wahid said the government was also working on increasing domestic economic activities through the implementation of projects under the Economic Transformation Programme. – Bernama

Thursday, October 10, 2013

MTUC against GST, fears widening of income gap

Posted on October 10, 2013, Thursday

KUCHING: The Malaysian Trades Union Congress (MTUC) Sarawak Division objects to the implementation of Goods and Service Tax (GST) which will reportedly be introduced in Budget 2014 to be tabled this month.

MTUC secretary Andrew Lo described GST as regressive tax as it has more pronounced effect on the poor and working class because it consumed a higher proportion of their income.

“MTUC is not convinced that GST is the way forward and this goes against efforts to achieve High Income Nation,” he said.

Lo pointed out that GST would be a move from tax on income to tax on consumption.

“Experience from the past 30 years had shown that companies will resort to all ways and means to avoid tax, setting up shell companies as tax havens.

“As a result, government tax revenues are squeezed and these same rich powerful people are pushing for the government to further reduce corporate and income tax and introduce GST,” he said.

One such example is Singapore which substantially reduced corporate and income tax, tripling per capital income and attracting largest investment and human capital.

“But the real story is that ordinary Singaporeans have been squeezed out of this so-called success until the government suffered a political backlash.

“The tripling of per capital income benefit the rich much more, the large investment benefited multinational companies,” he said.

Lo also noted claims that GST was needed because only 10 per cent of Malaysians are paying income tax whereas the remaining 90 per cent do not due to low income.

“It appears that GST is an attempt to get them to pay more tax without raising their income and supporters of GST argue that the more you consume the more you pay.

“However a person who earns 1,000 times more than the average Malaysian is not going to buy 1,000 more pillows, or eat 1,000kg more rice or buy 1,000 more watches.

“Instead he will buy a gold and diamond watch, not in Malaysia but overseas, exploiting the GST loophole that allow tourists to claim GST refund,” he said.

According to Lo, experience has also shown that most countries that introduce GST experience wider income disparity.

“When Japan raised their GST in 1995 it was widely blamed for plunging the country into the longest ever recession that they have yet to recover from.”

Pelaksanaan GST Masih Dalam Kajian

October 10, 2013

KUALA LUMPUR – Kerajaan sedang menjalankan kajian berkaitan sistem cukai barangan dan perkhidmatan (GST) bagi menilai impaknya terhadap kadar inflasi dan kaedah terbaik pelaksanaannya, kata Menteri di Jabatan Perdana Menteri Datuk Seri Abdul Wahid Omar.

Menjawab soalan Senator Khairiah Mohamed yang ingin tahu bilakah kerajaan akan memperkenalkan GST, Abdul Wahid memberitahu Dewan Negara hari ini, bahawa tarikh pelaksanaannya masih belum ditetapkan.

Beliau menjelaskan, pelaksanaan GST bagi menggantikan cukai jualan dan cukai perkhidmatan, merupakan satu daripada pendekatan jangka panjang kerajaan bagi meningkatkan hasil pendapatan negara.

“Cukai ini lebih komprehensif mencakupi hampir semua barangan dan perkhidmatan berbanding cukai jualan dan perkhidmatan yang tertakluk kepada paras nilai yang tertentu,” katanya.

Beliau berkata antara langkah lain untuk meningkatkan hasil negara ialah melalui syarikat minyak negara, Petronas yang akan terus meneroka potensi baharu di sektor berkaitan bagi mengekalkan tahap produksi minyak dan gas negara.

“Jumlah hasil petroleum meningkat daripada RM66.3 bilion pada 2011 kepada RM70.1 bilion pada 2012.

“Setakat Januari 2013, negara mempunyai rizab minyak berjumlah 5.85 bilion tong, dan ini berdasarkan kepada pengeluaran kita iaitu secara purata 600 tong sehari.

“Jadi jangka hayat sumber minyak kita adalah lebih kurang 27 tahun lagi,” katanya.

Abdul Wahid berkata kerajaan juga sedang berusaha meningkatkan aktiviti ekonomi domestik menerusi pelaksanaan projek utama di bawah Program Transformasi Ekonomi. – BERNAMA

GST to draw more attention to public spending, analysts say

BY OPALYN MOK

OCTOBER 10, 2013

Ferry passengers enjoy a clear view of George Town, Penang
on September 2, 2013. — Picture by K.E. Ooi

GEORGE TOWN, Oct 10 – The anticipated goods and services tax (GST) may broaden Putrajaya’s tax base but will also turn virtually every Malaysian into an active tax payer eager to scrutinise how the government spends his money, analysts said.

At present, just 10 per cent of the working population pay direct income taxation, but the possible introduction of the GST in Budget 2014 would create millions more active tax contributors more attentive to the wastage of public funds such as those detailed in the Auditor-General’s Report.

“If more people are contributing to the government funds, they will have more interest on how the government is spending these funds, which are essentially their money,” said Ibrahim Suffian, the director of independent pollsters Merdeka Center.

“The actual number of taxpayers currently, through income tax, is very small but when they broaden the base of taxpayers through GST, there will be a bigger voice by a larger group to highlight concerns on how the government is spending public funds,” he told the Malay Mail Online.

Dr Yeah Kim Leng,Group Chief Economist of RAM Holdings, concurred with the view that the introduction of the GST will make Malaysians more vested in the state of government spending.

“This larger group of taxpayers will hold the government more responsible for its expenditure and with more taxpayers, there will be greater pressure on the government to be more accountable on how they spend the funds,” he said.

Beyond creating greater public scrutiny, Yeah said the GST would also strengthen the government’s finances and fortify the country’s fiscal resilience in the long term.

“This is something we’ve been looking forward to as it will enhance overall tax administration and efficiency in the country,” he said, adding that the tax could also be a monetary policy tool.

But not everyone felt the greater scrutiny from more people being directly taxed will result in increased accountability.

Political scientist Faisal Hazis pointed out that some Malaysians, especially those in urban areas, were consistently critical of leakages and corruption in government spending, yet this did not stop the annual financial abuses and wastage revealed yearly in the Auditor-General’s Report.

“GST may increase public awareness but in terms of accountability, I am not optimistic that it would happen,” Faisal said, who urged the government to resolve these concerns before rolling out the new tax.

“The government should address these issues first before they implement GST as a measure to reduce deficit.”

While supportive of the positive effects the GST would have on public finances and policies, some analysts nevertheless voiced concern about the immediate consequence of the new consumption tax, especially in the lower income groups.

Ibrahim suggested that the government introduce a mechanism to alleviate the extra burden the lower income group may have to bear.

Professor of Economics Datuk Dr Woo Wing Thye warned that low wage earners will be hardest hit when the GST is trotted out, regardless of its rate.

“They will bear the brunt of this while those in the higher income group will not be greatly affected as they could still afford it,” he said.

Woo added that this should give Putrajaya pause over the introduction of the new tax in its bid to narrow the chronic budget deficit, saying that reducing spending could achieve this just as well as broadening the tax base.

“GST is the most effective way to collect revenue but this does not necessarily equate to expenditure efficiency,” Dr Woo said.

Putrajaya was placed under increase pressure to introduce the GST in Budget 2014 after global ratings firm Fitch cut its outlook on Malaysia’s sovereign debt from “Stable” to “Negative” in July, citing weaker appetite for reforms since the May 5 general election.

One such reform that it has openly called for is for Malaysia to diversify its tax base through new taxes such as the GST.

The GST is a consumption tax, meaning all Malaysians will be taxed according to their level of spending regardless of their income. This differs from income tax that is only applicable after a certain salary level is exceeded.

The tax was first announced during Budget 2005 and was originally scheduled to be implemented in 2007 before it was deferred.

The GST Bill was then tabled for the first reading in 2009 for implementation in late 2011, but was withdrawn during the second reading in 2010 following fierce public resistance.

Economists now expect the GST to be one of the measures implemented when Budget 2014 is tabled in Parliament on October 25.

If put into action, the GST will replace the existing sales tax of between five and 10 per cent and service tax of six per cent.

- See more at: http://www.themalaymailonline.com/malaysia/article/gst-to-draw-more-attention-to-public-spending-analysts-say#sthash.ULDw7Wv5.dpuf

Cukai rokok, arak, judi mungkin naik

7 Oktober 2013

Kenanga Investment Bank Bhd

KUALA LUMPUR - Terdapat kemungkinan bahawa cukai rokok, arak dan judi akan dinaikkan pada Belanjawan 2014 akan datang, melihat kepada kenaikan terbaharu harga rokok.

Naib Presiden Kanan, Ketua Penyelidikan Kenanga Investment Bank Bhd, Chan Ken Yew berkata adalah juga dijangka pasaran akan melihat beberapa potongan

subsidi dalam belanjawan itu.

"Selain meningkatkan kedudukan fiskal negara, adalah tidak mengejutkan untuk melihat kerajaan memperkenalkan Cukai Barangan dan Perkhidmatan (GST), dalam

usaha untuk meluaskan perolehan cukai," katanya pada satu sidang media di sini hari ini.

Mengenai impak belanjawan itu kepada pasaran tempatan, Chan berkata pengumuman ini tidak banyak memberi kesan, kecuali terdapat lebih banyak langkah

yang mesra pasaran seperti potongan cukai korporat.

"Bagi setiap satu peratus pengurangan pada cukai korporat, kami menganggarkan ini akan mendorong kira-kira 18 mata indeks di FTSE Bursa Malaysia KLCI," tambah beliau.

Belanjawan 2014 akan dibentangkan pada 25 Oktober di Parlimen oleh Perdana Menteri Datuk Seri Najib Tun Razak, yang juga merupakan Menteri Kewangan. - Bernama

Dewan Cina harap GST tetap bawah 4% jika dilaksana

8 Oktober 2013

KUALA LUMPUR - Dewan Perniagaan dan Industri Cina Kuala Lumpur dan Selangor berharap kerajaan akan menetapkan Cukai Barangan dan Perkhidmatan (GST), jika dilaksanakan, kurang daripada empat peratus dalam tempoh tiga hingga lima tahun pertama.

Presidennya Datuk Ter Leong Yap berkata kadar cukai yang lebih rendah untuktempoh tertentu dapat membantu rakyat menyesuaikan diri dengan sistem percukaianbaharu itu.

"Kami juga berharap menerusi GST, cukai peribadi dan korporat dikurangkan secara berperingkat," katanya kepada pemberita selepas melancarkan Anugerah 'My Hero' di sini oleh Menteri di Jabatan Perdana Menteri Tan Sri Joseph Kurup.

Mengenai anugerah 'My Hero', beliau berkata ia memperakui peranan wira dan wirawati kepada masyarakat.

Pemohon disyaratkan menulis kisah sebenar peristiwa yang berlaku sejak HariKemerdekaan hingga sekarang yang menyentuh hati.

Enam pemenang akan dipilih untuk menerima hadiah tunai RM3,000 dan trofi. Tarik tutup ialah pada 31 Oktober. - Bernama

Cukai pendapatan, GST dua perkara berbeza

Publication: BH

Date of publication: Oct 9, 2013

Section heading: Sentral

Page number: 008

? Adakah benar mereka yang berpendapatan kurang RM3,000 sebulan yang ketika ini tidak dikenakan cukai pendapatan, perlu membayar cukai apabila pelaksanaan Cukai Barang dan Perkhidmatan (GST) dilakukan kelak.

Gaji Rendah

Putrajaya Wilayah Persekutuan

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! Persepsi berkenaan kurang tepat berikutan kaedah pengenaan cukai bagi kedua-dua jenis cukai tersebut sangat berbeza. Kaedah pengenaan cukai pendapatan berasaskan kepada jumlah pendapatan diperoleh individu, manakala pengenaan GST adalah berdasarkan kepada kepenggunaan terhadap sesuatu barang atau perkhidmatan yang digunakan.

Ketika ini pun, mereka yang tidak dikenakan cukai pendapatan masih tetap membayar cukai jualan atau cukai perkhidmatan ke atas barang dan perkhidmatan yang digunakannya. Persoalannya, kebanyakan pengguna tidak menyedari bahawa harga barang atau perkhidmatan yang dijual peniaga runcit sudah termasuk elemen cukai. Pada hakikatnya, pengenaan GST tidak memberi sebarang perbezaan dalam aspek bebanan cukai ditanggung mereka yang berpendapatan kurang RM3,000 sebulan kerana pada masa ini, mereka sudah membayar cukai terhadap barang dan perkhidmatan tertentu yang digunakan.

Jurucakap

Kementerian Kewangan

My Hero usaha galak perpaduan

Publication: BH

Date of publication: Oct 9, 2013

Section heading: Bisnes

Page number: 006

Byline / Author: Oleh Zuraidah Mohamed

Dewan Perniagaan dan Perindustrian Cina Kuala Lumpur dan Selangor (KLSCCCI) akan terus memberikan pengiktirafan kepada individu yang berjasa dalam masyarakat menerusi Anugerah My Hero yang akan diadakan setiap tahun.

Presidennya, Datuk Ter Leong Yap, berkata pihaknya juga sentiasa meninjau peluang kerjasama dengan pelbagai pihak termasuk media bagi melaksanakan lebih banyak projek dan aktiviti ke arah menggalakkan perpaduan dan keharmonian negara.

Sehubungan itu, katanya KLSCCCI menubuhkan tabung Dana Perpaduan dengan dana permulaan sebanyak RM100,000 bagi membolehkan lebih banyak program ke arah perpaduan rakyat dapat dilaksanakan.

"Kami bercadang untuk mengadakan Anugerah My Hero ini setiap tahun berikutan sambutan baik yang diterima setakat ini. Langkah melanjutkan tarikh tutup penyertaannya sehingga akhir bulan ini adalah antara inisiatif berterusan kami bagi membolehkan lebih ramai dapat menzahirkan penghargaan kepada insan yang berjasa," katanya pada sidang media selepas pelancaran Anugerah My Hero di Kuala Lumpur, semalam.

Majlis pelancarannya disempurnakan oleh Menteri di Jabatan Perdana Menteri, Tan Sri Joseph Kurup. Yang hadir sama, Pengerusi Jawatankuasa Penganjur Anugerah My Hero, Tan Tian Meng.

Anugerah My Hero diadakan dengan kerjasama akhbar Nanyang Siang Pau yang mendapat sokongan Jabatan Perdana Menteri (Jabatan Perpaduan dan Integrasi) serta Dewan Perniagaan dan Perindustrian Cina Malaysia (ACCCIM).

Berita Harian (BH) dan New Straits Times adalah akhbar rasmi manakala Sunsuria Development Sdn Bhd adalah penaja utama anugerah berkenaan.

Sasar 20 penyertaan

Ter berkata, pihaknya menyasarkan sekurang-kurangnya 20 penyertaan bagi anugerah berkenaan dan hanya enam nukilan yang menampilkan kisah paling menyentuh hati akan dipilih sebagai pemenang untuk membawa pulang wang tunai RM3,000 serta hadiah iringan.

Katanya, kisah mengenai individu yang banyak berjasa wajar dizahirkan kepada umum sebagai tanda penghargaan kepada insan berkenaan termasuk ada yang sanggup menggadaikan nyawa.

Kisah hero tidak mengenal batas kaum itu, akan disiarkan dalam akhbar tempatan termasuk BH.

"Kami juga baru-baru ini melancarkan program Titian Perniagaan yang mengetengahkan syarikat atau perniagaan yang mempunyai pekerja berbilang kaum dan bagaimana majikan dan pekerja bekerjasama menguruskan perniagaan," katanya.

Sementara itu, ditanya mengenai harapan KLSCCCI dalam Bajet 2014, Ter berkata, pihaknya mengharapkan pembentangan bajet kali ini lebih mesra rakyat dan pelaksanaan langkah rasionalisasi subsidi kerajaan akan dilaksanakan secara berperingkat supaya tidak memberi tekanan terus kepada rakyat.

Mengenai cukai barangan dan perkhidmatan (GST), katanya pelaksanaannya perlu disegerakan dan pihaknya mencadangkan supaya dilaksanakan pada kadar di bawah empat peratus, sekurang-kurangnya untuk tempoh tiga hingga lima tahun.

"Kita kini sedang menuju ke arah negara berpendapatan tinggi, dan untuk mencapainya kerajaan dan rakyat perlu bekerjasama untuk mewujudkan produktiviti," katanya.

Unionist tags GST as regressive tax

Published: Wednesday October 9, 2013 MYT 12:00:00 AM

Updated: Wednesday October 9, 2013 MYT 3:43:16 PM

KUCHING: The state Malaysian Trades Union Congress (MTUC) is not convinced that the Goods and Services Tax (GST) is the way forward for the country as it would have a greater impact on the lower income group.

Its secretary Andrew Lo (pic) called the GST a “regressive tax” as it had more pronounced effect on the poor and working class given that it consumed a higher proportion of their income.

Reacting to the possibility that the GST would be announced in the 2014 Budget to be tabled in Parliament this month, he said in a press statement: “This (GST) goes against the ‘high income nation for everybody policy’.”

He said the GST was a move from tax on income to tax on consumption and that those who promoted it claimed that lower corporate and income tax would generate investment and jobs although experience in the past 30 years showed that companies would resort to all means possible to avoid tax, even setting up shell companies in tax havens.

“As a result, the government tax revenues are squeezed and these same rich powerful people are pushing for the Government to further reduce corporate and income tax and to push for the introduction of GST,” Lo said.

He added that there were claims that Malaysia needed the GST because only 10% of Malaysians paid income tax and that 90% of Malaysians did not do so because their income was too low.

In this respect, he felt that the GST was an attempt to get them to pay more tax without raising their income.

“Supporters of GST argue that the more you consume, the more you pay. Sounds fair? However a person who earns 1,000 times more than the average Malaysian is not going to buy 1,000 more pillows, or eat 1,000kg more rice or buy 3,000 more watches.

“He will buy a gold and diamond Rolex but not in Malaysia but overseas, exploiting the GST loophole that allows tourists to claim GST refund.

“Experience has also shown that most countries that introduce GST also experience widening income disparity.

“It serves well to remind the Government that when Japan raised their GST in 1995, it was widely blamed for plunging the country into the longest ever recession from which they have yet to recover,” said Lo.

Wednesday, October 9, 2013

Economists urge Govt to speed up GST

Published: Tuesday October 8, 2013 MYT 12:00:00 AM

Updated: Tuesday October 8, 2013 MYT 4:16:52 PM

BY JOHN LOH

Kenanga Research economist Wan Suhaimi (right) says
Singapore's GST implementation led to substantial reduction in corporate
and income tax, tripling of per capita income and drew large investments
and human capital, while Kenanga head of research Chan Ken Yew
thinks the introduction of GST might even lead to a rally on the local bourse.

KUALA LUMPUR: The sooner the better. That’s how economists feel about the goods and services tax (GST), whose unveiling is widely anticipated in Budget 2014.

Kenanga Research economist Wan Suhaimi Saidie said a comparative study on the broad-based tax in Australia, Singapore and Thailand showed a positive wealth effect, with the three countries experiencing three- and even four-fold increases in gross domestic product (GDP) per capita post-GST.

“It’s basic economic theory. As the system becomes more efficient across the supply chain, wages, prices and wealth can be distributed more evenly,” he told the press at a briefing yesterday.

Wan Suhaimi cited Singapore as having the best model for the GST implementation, which saw the city-state substantially reducing corporate and income tax, tripling per capita income and attracting large investments and human capital.

Kenanga Research is expecting an initial GST rate of between 4% and 7%, with 5% being the most likely.

The consumption-based tax, on which basic necessities would be exempted, could be introduced next July at the earliest or January 2015, the local research outfit said.

But Wan Suhaimi suggested that a quick implementation was crucial if the Government intended to stick to its deficit reduction target of 3% by 2015.

Ratings agencies, which have been keeping close tabs on Malaysia’s debt situation and dwindling current account surplus, are also in favour of the Government cleaning up its fiscal house, rather than being fixated on growth, which should come naturally with the recovery in external demand, Wan Suhaimi said.

According to Kenanga Research, a January 2015 timeline for the GST would result in an end-2015 deficit of 3.5%, off the Government’s target by 0.5%.

If the tax took effect next July, however, then the fiscal deficit is likely to be pared down to 3.1% by the end of 2015, its numbers show.

GST introduction might even lead to a rally on the local bourse, if the stock markets of Australia, Singapore and Thailand were any indication, Kenanga head of researchChan Ken Yew said.

Their benchmark indices soared shortly before the tax came into effect, as consumers hoarded goods and services to avoid paying higher prices, giving markets a short-lived sugar rush.

On his outlook for the market, Chan said he was adopting a “cautiously optimistic” approach, advising clients to buy on weakness – especially if the FTSE Bursa Malaysia KL Composite Index plunges below 1,745 points – and be selective in their stock picks.

Domestic liquidity was not at risk of drying up soon, Wan Suhaimi added, dismissing as overblown concerns of a mass capital outflow. “It was just a knee jerk reaction,” he said.

And despite the impending pullback of the US Federal Reserve’s easy money policies, which fear-mongers say will drive an unprecedented exit of foreign capital from emerging markets, Chan is taking a contrarian view.

“Foreign investors are returning to Bursa Malaysia. They turned net buyers again recently,” Chan said, noting that the still near-zero interest rates in most Western countries were a boon to monetary expansion.

On ways to play the market, Chan said blue chip laggards such as Telekom Malaysia Bhd and RHB Capital Bhd were poised to catch up due to yearend window dressing activities, while lower liners typically saw action in the final and first quarters of the year thanks to seasonal strength from retailers.

Linking GST with public fund wastage

Published: Wednesday October 9, 2013 MYT 12:00:00 AM

Updated: Wednesday October 9, 2013 MYT 7:44:08 AM

I REFER to the article by Tan Sri Dr Fong Chan Onn “Merits of the GST system” (The Star, Oct 5).

Dr Fong wrote of the merits of the Goods and Services Tax (GST) system and opined that it is the fairest method of taxing the general public.

In a pure GST regime, the poor tend to pay more (as a proportion of their income) but this could be made fair with modifications.

All that is well and good but where is all this extra revenue going? It logically should go to fuel Malaysia’s economic growth.

The dilemma with implementing the GST is will it lead to growth or will it breed more inefficiency and callousness in the government delivery system?

Malaysia has been blessed in not having major natural disaster calamities to contend with and there is an abundance of natural resources. So what does Malaysia suffer from in its journey to be a developed nation by 2020? The answer is staring in the faces of those who have read the Auditor-General’s 2012 report.

Much has been said and commented upon culminating in one of the Malaysian Anti-Corruption Commission (MACC) supervisory panels urging the Chief-Secretary to the Government Tan Sri Dr Ali Hamsa to form a special committee to investigate the wastage of taxpayers money.

The absolute lack of proper governance in the government service is a cause for concern. Whilst the regulatory authorities for the corporate sector have come up with the Corporate Governance code to instill the need for transparency, accountability and governance, there appears to be a disconnect in the civil service.

If the board of directors are held accountable by the regulators and stakeholders of the company, who is to be held responsible for such misconduct, negligence and ineptness at the federal or state government levels?

Notwithstanding the obvious wastage of resources, the more pressing concern is the perception in society that this involves,in almost all cases, endemic corruption.

Negligence and ineptness due to lack of moral responsibility in the discharge of duties have resulted in the plethora of findings in the AG’s report. These instances are not under MACC’s purview yet it gets bad press in spite of its efforts for not nabbing the “big fish”.

What is more difficult to fathom is that these are repeat findings yet there is a sense of malaise in the government machinery.

Is it because complacency has set in to the extent that officers know that their job is secure and the most that one will have to endure is a slap on the wrist as opposed to being demoted or removed from service as in the private sector? The punishment must fit the crime. Are we not Malaysia Inc.?

Much has been said by the Chief Secretary and politicians on remedial actions. Hopefully it is not just rhetoric.

Do we need public oversight panels to supervise and plough through the veracity of the follow-up actions required so that we have a more robust delivery system? If that is what is required, so be it.

There should be a breakdown to determine whether the weaknesses are due to incompetence and negligence or if there is an element of corruption. Hopefully that will address societal concerns on what is wrong in the machinery.

With the GST implementation, modified or otherwise, the poor will have to pay more. It is morally and ethically irresponsible to tax more yet have a continuance of such wastages due to ineffective governance.

The civil service on one hand has the best brains to drive this country forward. They should be commended for the good job done to-date as we are admired by our peers in the region.

Weed out the incompetents which invariably exist on the other end of the spectrum as evidenced by the audit findings. Repeat findings are inexcusable not to mention disgraceful. No wonder corruption perception indexes are negative as incorrect inferences are deduced.

As we move towards GST, let’s repair the leakages effectively. Malaysia does not have to suffer ‘fools’! We look forward to the next 50 years of Malaysia.

WALTER SANDOSAM

Kuala Lumpur

Dewan Cina harap GST bawah 4 peratus jika dilaksanakan

2013/10/08 - 17:50:59 PM

KUALA LUMPUR: Dewan Perniagaan dan Industri Cina Kuala Lumpur dan Selangor berharap kerajaan akan menetapkan Cukai Barangan dan Perkhidmatan (GST), jika dilaksanakan, kurang daripada empat peratus dalam tempoh tiga hingga lima tahun pertama.

Presidennya, Datuk Ter Leong Yap, berkata kadar cukai yang lebih rendah untuk tempoh tertentu dapat membantu rakyat menyesuaikan diri dengan sistem percukaian baharu itu.

"Kami juga berharap menerusi GST, cukai peribadi dan korporat dikurangkan secara berperingkat," katanya kepada pemberita selepas melancarkan Anugerah 'My Hero' di sini, hari ini.

GST the way forward

Posted on 7 October 2013 - 07:20pm

WE refer to "Anwar warns of protest against GST" (News Without Borders, Oct 7). What is there to protest?

What is wrong with the goods and services tax when more than three fourths of the world has implemented it. They cannot all be wrong?

Malaysia has an extremely low percentage of personal income tax contributors – as low as 5% (1.4 million) of Malaysians pay income tax.

For some reason, Petronas contributes as much as a third of the federal government revenue; that is not healthy. International rating agencies have warned us that our sovereign rating will be downgraded if we continue with our old ways; that is spending (especially on subsidy) beyond our means.

Let's be rational with our spending and broaden our tax base. Other than essential goods and services, let's chip in and pay our due.

Philip Wong Pak Ming

President

Kuching Canadian Graduates' Association

- See more at: http://www.thesundaily.my/node/225982#sthash.L2iTXQ1B.dpuf

Real property gains tax hike likely in Budget 2014

Published: Wednesday October 9, 2013 MYT 12:00:00 AM

Updated: Wednesday October 9, 2013 MYT 7:21:21 AM

PETALING JAYA: The local property sector may only see a real property gains tax (RPGT) increase in Budget 2014, according to a report by Kenanga Research.

It said it was expecting the tax rate to increase to 30% from 15% for properties sold within two years and 15% from 10% for properties sold within three to four years.

It said the 10% rate would remain unchanged for properties sold in the fifth year and zero RPGT for properties sold in the sixth year onwards.

“We believe this has been largely been discounted and priced-in somewhat, but we do expect some slight knee-jerk reactions for a couple of weeks post announcement,” it said. Budget 2014 will be tabled on Oct 25.

Kenanga Research also said the market could experience “panic buying” by investors next year if the goods and services tax (GST) was implemented in 2015.

“Experience from other countries had seen such trends in anticipation of future cost push inflations on asset prices.

“This will benefit 2014 sales of developers as financing terms for the primary market is more favourable compared with that of the secondary market.

“We do expect developers to front-load their launches in 2014 on the back of higher demand, which will be a big booster to future earnings,” it said.

On the Johor property market, Kenanga said the restriction on foreigners from buying secondary properties from locals would be good for the rental market and new launches.

On the the 4% to 5% tax rate of the sales price of all properties, it said was unlikely to slow down demand from foreigners, especially Singaporeans, as properties in Singapore are three times to five times more expensive than Johor.

On another note, Kenanga said it did not expect the build-then-sell (BTS) model to be implemented in Malaysia.

“The Malaysian economy is not ready for a BTS model as many smaller developers will not be able to cope with such a model while larger developers with strong financial positions will likely price-in premiums of selling BTS properties.”

McD receipts show govt tax

Published: Wednesday October 9, 2013 MYT 12:00:00 AM

Updated: Wednesday October 9, 2013 MYT 7:20:43 AM

IN our report titled “GST can generate more total revenue” which appeared on Saturday, Oct 5, we would like to clarify that, contrary to what was stated in the article, sales receipts given out at McDonald’s restaurants show the government tax rate of 6% and the sum representing the tax amount.

A sample of the receipt issued by all McDonald’s restaurants is shown here. We apologise for the error in the information published and any problem that may have arisen from it.

Chinese Chambers hopes GST to be capped at 4%

Published: Tuesday October 8, 2013 MYT 5:35:00 PM

Updated: Tuesday October 8, 2013 MYT 5:43:35 PM

Minister of Prime Minister Department, Tan Seri Joseph Kurup (left),
and president of the Kuala Lumpur and Selangor Chambers of Commerce and Industry,
Datuk Ter Leong Yap (right), holding the "My Hero" awards during launching of the awards
at Wisma Chinese Chamber on Oct 8, 2013.

KUALA LUMPUR: The Chinese Chambers of Commerce and Industry of Kuala Lumpur and Selangor hopes the government will keep the Goods and Services Tax (GST) at below 4% in the first three to five years of implementation.

President Datuk Ter Leong Yap said that a lower tax rate for a certain period would help the people adapt to the new tax system, which many expect to be implemented next year.

"We also hope that with the GST, personal and corporate taxes will be reduced gradually," he told reporters after the launch of the My Hero Award on Tuesday by Minister in the Prime Minister's Department Tan Sri Joseph Kurup.

Meanwhile, on the My Hero award, he said it would recognise and acknowledge unsung heroes and heroines for their great deeds to society.

Applicants are required to write a true touching story on incidents that have occurred from Independence Day up to now, with six winners to be picked to receive RM3,000 in cash, plus a trophy. The closing day for entries is Oct 31 – Bernama.