'East M'sia will not lose revenue when GST is implemented'

Posted on 29 January 2014 - 05:16pm

KUCHING (Jan 29, 2014): An appropriate mechanism will be established to ensure Sabah and Sarawak state governments will not lose their revenue when the Goods and Services Tax (GST) is enforced on April 1, 2015.

Deputy Finance Minister Datuk Ahmad Maslan said the federal government would hold follow-up discussions with the two state governments on the matter as they have the autonomy to collect taxes.

"Under Article 95B of the Federal Constitution, the Sarawak state government, for example, can impose sales tax on products and services," he told reporters after attending a state-level National Economic Empowerment seminar here today.

Sarawak Housing and Tourism Minister Datuk Amar Abang Johari Tun Openg represented Chief Minister Tan Sri Abdul Taib Mahmud to open the seminar.

A total of 1,500 participants attended.

Ahmad said Sabah and Sarawak were the only states in Malaysia empowered to collect taxes and the GST must take this constitutional provision into consideration.

"Whatever the decision is, we'll not cause hardship to the people of Sabah and Sarawak. We'll not let the two states lose out in terms of revenue," he said.

Earlier, in his speech, Abang Johari said the GST implementation in Sarawak must take into account the constitutional provision that the state government has the power to impose taxes.

"Although the state government has no qualms accepting the GST, we hope further talks will be held to fine-tune the mechanism of the GST implementation," he added. – Bernama