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Tuesday, October 14, 2014

Opposition hoodwinking Malaysians over GST, says Ahmad Maslan

Deputy Finance Minister says the opposition has misled the people over the GST issue. – The Malaysian Insider file pic, October 14, 2014.Deputy Finance Minister says the opposition has misled the people over the GST issue. – The Malaysian Insider file pic, October 14, 2014.
Datuk Ahmad Maslan has accused the opposition of being less than forthright about the implications of the Goods and Services Tax (GST).
The deputy finance minister pointed out that the opposition had failed to mention that with the introduction of the GST, there would no longer be a Sales and Services Tax (SST).
"I have heard what the opposition, including its leader Datuk Seri Anwar Ibrahim, has to say about the GST. But it appears to me that Parti Keadilan Rakyat (PKR) is confused about the GST.
"PKR has been busy portraying the GST as an additional tax or burden to the rakyat, they have conveniently failed to mention about the SST being replaced by the GST."
Ahmad said presently, the SST costs the rakyat more than the proposed GST, which will come into effect on April 1 next year.
"Is PKR intentionally misunderstanding the SST or they are purposely choosing not to raise this particular issue?" Ahmad asked during a briefing in Cyberjaya today.
He was speaking at the Budget 2015 briefing held for senior Inland Revenue Board officers today, following last week's presentation by Prime Minister Datuk Seri Najib Razak.
Ahmad said the Customs Department collected 5% SST taxes on processed foods, a cost which was passed down from manufacturers to retailers until it reached the consumers.
"At the end of the line, the consumer ends up paying up to 8% more on the processed foods as a result of the cost being passed down," Ahmad said.
Similarly for clothing, furniture, vehicles and electrical items, the 10% SST charged was passed down to the consumers, who ended up paying between 15% and 18% more.
"But with the introduction of GST at 6%, the additional SST costs will be removed and consumers will not have to pay as much tax anymore."
Deputy Finance Minister Datuk Ahmad Maslan says the GST is a better tax system compared with the SST. – The Malaysian Insider pic by Afif Raiezal, October 14, 2014. Deputy Finance Minister Datuk Ahmad Maslan says the GST is a better tax system compared with the SST. – The Malaysian Insider pic by Afif Raiezal, October 14, 2014.Ahmad said Putrajaya wanted an efficient tax system, not the opposite which appeared to be what PKR was looking to retain.
"For Putrajaya, 6% is better than placing additional SST burden on the rakyat who are the end consumers," Ahmad told a press conference.
Meanwhile, Ahmad said Putrajaya had no intention of implementing the proposed Capital Gains Tax (CGT) which had been raised by the opposition.
"There are not many rich people in Malaysia, hence it serves little purpose to implement the CGT as proposed by the opposition."
"I cannot speak for the future but presently, there are not that many rich people in Malaysia so CGT will not yield much revenue for Putrajaya."
Furthermore, Ahmad said the CGT would also deter local and foreign direct investors as they would not be able to reap their full profits.
"One of the components of CGT has already been implemented by Putrajaya during last year's Budget presentation," Ahmad said, referring to the real property gains tax (RPGT).
Last year, Najib had announced that the RPGT rates had been increased in order to deter speculators from driving up the property market.
"Putrajaya had also previously implemented the inheritance tax but this was later scrapped and there are no plans to revive this tax," Ahmad said.
- TMI

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