Goods And Services Taxes (GST) Does Not Burden The People, Says Malaysian Premier
Malaysian Prime Minister, Datuk Seri Najib Abdul Razak said the introduction of the Goods and Services Tax (GST), although unpopular, was the right decision in view of changing economic circumstances. He said the GST was only imposed after extensive studies were carried out and that it was “halal” and did not burden the people.
He said the Malaysian National Fatwa Council had confirmed that it was “halal” (legitimate) and was necessary to ensure the nation’s economy. He said several quarters had previously claimed that GST implementation was unIslamic and therefore considered as not halal. “Rest assured that the GST implementation in Malaysia was designed as a ‘package’ so as not to burden the rakyat”.
The Reduction of Tax and Increase of BR1M
This, he said could be seen in the reduction of personal income tax by 1% to 3% for year of assessment 2015, reduction of 1% in corporate tax, as well as the increase of BR1M for the lower income group, he said. “Also, our GST is much lower compared to the taxed imposed by so many other countries on their citizens. This is the money used to subsidise education, health, allowances for fishermen and farmers,” said Najib. According to the premier, the Malaysian version of GST was arguably the most complex and multi-layered in the world as it exempts many goods and services.
In fact, he said halal traders would actually benefit from the GST as the tax will not be applied on exported goods and services. He said Malaysian firms would also benefit from a lower cost of doing business by recovering any input taxes “More than 4,000 goods were exempted and zero-rated in the new tax. “We have done it this way because we want a soft landing for people to accept and embrace GST,” he said.