KUALA LUMPUR – Prime Minister Datuk Seri Najib Tun Razak today assured Malaysians that the Goods and Services Tax (GST), a progressive tax system to be implemented on April 1, 2015, will not burden them.
He said the new tax structure, which is adopted by 90 per cent of the countries in the world, must be implemented in Malaysia to ensure sustained and continued growth for the country.
Najib said the government was not rushing into implementing the GST as it had studied its implications for the past 30 years and was convinced that it would benefit the people and country.
“Be assured, I will not burden the people. As the Barisan Nasional Chairman, I will not inconvenience them as the government is backed by the peoples’ support,” he said when closing a briefing session on GST at the Putra World Trade Centre here, Wednesday.
The government will implement the GST at a fixed rate of six per cent to replace the present Sales and Services Tax at 16 per cent.
Najib also explained to the 2,000 odd participants why the GST was good, how it would spur the country’s economic growth and in attaining developed nation status.
He said the GST was not new as it had been mentioned by three previous finance ministers including Opposition Leader Datuk Seri Anwar Ibrahim, when he tabled the budget on Oct 30, 1992.
“We must have strong financial resources. Each time we present the annual budget, there must be the bonus element, or else the budget is considered not good.
For a month’s bonus, the government has to fork out about RM5.6 billion. It is the government’s responsibility to look after the 1.5 million civil servants and 300,000 pensioners. The country needs enough resources,” he said.
Najib said to sustain the country’s financial stability, the implementation of GST was vital to increase revenue stream.
Najib said out of a workforce of 12 million people, only 1.2 million employees were paying taxes and the revenue collected was benefiting 28 million Malaysians.
“Among others, tax revenue was necessary for the provision of health services, as there was always a pressing need to increase hospitals and beds for the people,” he said.
However, Najib admitted that the GST would result in a slight increase of 1.8 per cent in the price of certain goods.
But, he assured that the increase would not involve essential goods and services and, strict enforcement would be in place with additional back up of enforcement officers from the Ministry of Domestic Trade, Cooperative and Consumerism.
“The public can also lodge reports to the government against unscrupulous traders who raise prices so that action can be taken against them,” he said, adding that recipients of the 1Malaysia People’s Aid (BR1M) should also use their one-off handouts wisely.
Beginning next year, the government would top up an additional RM300 to the current payment of RM650 to alleviate the plight of the low-income following the introduction of GST.
Najib also advised traders to be GST ready by registering their businesses as soon as possible and not wait until the last minute. – Bernama