ARAU – The proposed reinstatement of the Goods and Services Tax (GST) is seen as the best measure for reviving and increasing the nation’s revenue amid the country’s transition to the endemic phase which began on April 1, according to an economist.
Universiti Teknologi Mara Perlis senior lecturer (economy) Assoc Prof Azman Daim said the proposed reintroduction of the tax – a value-added tax which is collected at various stages of the supply chain – is to replace the Sales and Service Tax (SST).
“The benefits of implementing GST include enabling the government to generate more stable revenue and it being more efficient. The tax should be implemented to help tackle the people’s economic problems and curb the excessive rise in prices for certain basic necessities,” he said here today.
However, he said the GST rate, which was previously set at 6%, should be slightly lower so the people would not be “shocked” as many are still grappling with the effects of the Covid-19 crisis.
Prime Minister Datuk Seri Ismail Sabri Yaakob was reported as saying recently that the possible reinstatement of the GST is seen as capable of broadening the country’s revenue base, and that the government has not ruled out the possibility of reinstating it as an effective way to increase national income and help combat inflation and the rising cost of living.
He said the people need to understand and accept it first before the government decides to introduce any new taxation system.
The GST was first introduced in Malaysia on April 1, 2015, at 6%, but it was suspended on June 1, 2018, and finally abolished and replaced by the SST on September 1, 2018.
The current rates for the sales tax are 5% and 10%, while the service tax is at 6%. – Bernama, June 11, 2022
.jpg)
