Will the Madani Government Re-Implement GST?


 The Goods and Services Tax (GST) is a value added tax that was introduced in Malaysia in April 2015.

Later, the Malaysian government that changed at that time presented a bill to abolish the GST for the first reading in the Dewan Rakyat on 31 July 2018 and replaced it with the Sales or Service Tax (SST) in September 2018.

Now, there are more than 160 countries that have implemented it and only Malaysia, Myanmar and Brunei are the only Asean countries that do not agree with the implementation.

Lately, there have been rumors that the government is considering reintroducing GST as it has more advantages than the current SST tax.

According to Malaysia's Economy Minister, Rafizi Ramli, the government will not take steps to re-establish GST because people's incomes have not yet reached the level of progressive wages. Setting a comprehensive tax on all citizens will burden them more.

He also said that the government is in an effort to 'track down' those who are trying to escape from paying taxes in order to close the gaps in restoring the country's economy.

In addition, Rafizi also said that the implementation of the tax payment system in developed countries is more orderly. Unlike in Malaysia, many people who are 'more able' in this country find a thousand and one steps to avoid paying taxes.

Although Malaysia is among the countries that collect the lowest tax revenue in Asia, it will not be a strong reason for the government to implement GST again.

In re-establishing GST, it requires more thoroughness and considering every angle before making a decision. After all, SST tax collection in this country is not much different in value from GST.