PKR MP: Freeze GST until salaries rise

BY BOO SU-LYNJANUARY 8, 2014

UPDATED: JANUARY 08, 2014 01:51 PM

To back his opinion, Rafizi pointed out that KPMG managing partner
Johan Idris had yesterday suggested a six per cent increase in employees’
salaries per annum after the broad-based consumption tax takes effect.

PETALING JAYA, Jan 8 — Putrajaya cannot implement the Goods and Services Tax (GST), which is scheduled for April next year, until workers’ salaries are increased and household incomes go up, PKR’s Rafizi Ramli said today.

To back his opinion, the Pandan MP pointed out that KPMG managing partner Johan Idris had yesterday suggested a six per cent increase in employees’ salaries per annum after the broad-based consumption tax takes effect.

“Keadilan remains firm that as long as the government does not take effective steps in raising workers’ salaries, the GST cannot be implemented,” Rafizi told reporters at PKR’s headquarters here today.

“Keadilan has said long ago that household incomes must be at least RM4,000 a month before the GST can be considered,” added the PKR strategic director.

National news agency Bernama quoted Johan yesterday as saying that a six per cent pay hike for both public and private sector employees would help them bear the burden of the implementation of the GST, as well as increases in electricity tariffs, fuel prices and toll rates.

The senior official with the accounting firm, however, noted that implementing the GST is inevitable, given that Malaysia is a developing country.

Rafizi said today that Putrajaya has the power to revise the salary structure of civil servants.

“Civil servants are such a big group of workers that their salaries are a reference point for the salary structures of other sectors,” he said.

“The government is responsible for depressing the average salary in the private sector because Barisan Nasional (BN) depends on cheap foreign labour,” added the lawmaker.

Rafizi further hit out at Putrajaya for spending RM200 million to implement the GST, a consumption tax that is intended to raise revenue in order to rein in the country’s budget deficit.

“For example, Datuk Seri Khazali Ahmad, the Customs director-general, announced that the government has spent RM100 million so far to set up an accounting software system to implement the GST, which is called MyGST. This system will even be sold to traders,” he said.

“Meanwhile, Khairul Annuar Othman, the Finance Ministry’s assistant secretary-general of taxes, said that Budget 2014 has allocated RM100 million to run GST campaigns and training. This RM200 million, which is only a portion of the expenses in the GST implementation, is a huge expenditure, especially since BN is trying to tax the people to control the budget deficit,” added Rafizi.

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