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Fix existing loopholes before introducing new taxes

Decorative photo / NSTP FILE

KUALA LUMPUR: The government’s decision not to introduce a new tax this year includes the proposed reintroduction of the Goods and Services Tax (GST), coinciding with the situation.

 

However, the government’s opinion expert still needs safe measures to ensure that the country’s economy is not affected.

 

The President of the Malaysian Association of Taxation Accountants (MATA), Datuk Abdul Aziz Abu Bakar, said various weaknesses identified must be fixed before any tax or re-implementation of GST is implemented if that is decided.

 

“We understand that tax implementation is an important economic instrument for revenue or income.

This includes the repealed GST. It can actually be re-implemented because it is effective in increasing government revenue, but it does not have to be done hastily.”

He said here, today.

 

According to today’s BH report, the government thinks that a new taxation system, including GST, is unlikely to be implemented this year.

 

The Finance Minister, Tengku Datuk Seri Zafrul Tengku Abdul Aziz, insists that before introducing any new taxes, the government needs to ensure that the post-COVID-19 economic recovery is on a stable and strong track.

 

Commenting further, Abdul Aziz said the government should look at the current environment of the country’s economy before re-implementing the GST including reviewing the GST rate to lower than six percent, as well as increasing the threshold to above RM500,000.

 

He said the GST was often claimed to be a major factor in the increased price of goods and services, but the abolition of the tax did not change the situation, but the cost was increasing.

 

“We see the re-implementation of GST as the most effective method of taxation for the country to reap revenue.

The implementation should be given a period that it deems relevant to retrain traders as well as to channel comprehensive information to consumers.

What the people need to know, the re-implementation of new taxes such as GST 2.0 will take a long time because of the GST Act will have to be tabled again and passed in Parliament after it is repealed in 2018″

He said.

 

Putra Business School (PBS) Economic Analyst, Assoc Prof Dr. Ahmed Razman Abdul Latiff said the government’s decision to enact the Fiscal Responsibility Act (FRA), the implementation of the Medium-Term Revenue Strategy (MTRS), and the Public Expenditure Review (PER) to ensure that fiscal governance is in good condition and the country is able to achieve fiscal sustainability for the medium and long term.

 

“It is hoped that it will reduce leakage and eliminate the symptoms of corruption that causes the country to lose a lot of revenue every year.

If the implementation of the new tax or GST is returned, this will surely add to the burden of the people”

he said.

 

Agreeing with the government’s move not to implement new taxes in the near future, however, he thinks that the government should not continue to subsidize bulk, especially the RON95 petroleum subsidy which increases the burden of spending.

 

“Targeted subsidies should be introduced by focusing on the vulnerable and the low income group of 40 per cent (B40).

In order to address the risk of rising prices of goods due to the absence of petroleum subsidies for the majority of the population and traders, direct assistance initiatives to the B40 should be continued so that the impact of the increase in the price of goods does not negatively affect this group”

he said.

Fix existing loopholes before introducing new taxes

Decorative photo / NSTP FILE

KUALA LUMPUR: The government’s decision not to introduce a new tax this year includes the proposed reintroduction of the Goods and Services Tax (GST), coinciding with the situation.

 

However, the government’s opinion expert still needs safe measures to ensure that the country’s economy is not affected.

 

The President of the Malaysian Association of Taxation Accountants (MATA), Datuk Abdul Aziz Abu Bakar, said various weaknesses identified must be fixed before any tax or re-implementation of GST is implemented if that is decided.

 

“We understand that tax implementation is an important economic instrument for revenue or income.

This includes the repealed GST. It can actually be re-implemented because it is effective in increasing government revenue, but it does not have to be done hastily.”

he said here, today.

 

According to today’s BH report, the government thinks that a new taxation system, including GST, is unlikely to be implemented this year.

 

The Finance Minister, Tengku Datuk Seri Zafrul Tengku Abdul Aziz, insists that before introducing any new taxes, the government needs to ensure that the post-COVID-19 economic recovery is on a stable and strong track.

 

Commenting further, Abdul Aziz said the government should look at the current environment of the country’s economy before re-implementing the GST including reviewing the GST rate to lower than six percent, as well as increasing the threshold to above RM500,000.

 

He said the GST was often claimed to be a major factor in the increased price of goods and services, but the abolition of the tax did not change the situation, but the cost was increasing.

 

“We see the re-implementation of GST as the most effective method of taxation for the country to reap revenue.

The implementation should be given a period that it deems relevant to retrain traders as well as to channel comprehensive information to consumers.

What the people need to know, the re-implementation of new taxes such as GST 2.0 will take a long time because of the GST Act will have to be tabled again and passed in Parliament after it is repealed in 2018″

he said.

 

Putra Business School (PBS) Economic Analyst, Assoc Prof Dr. Ahmed Razman Abdul Latiff said the government’s decision to enact the Fiscal Responsibility Act (FRA), the implementation of the Medium-Term Revenue Strategy (MTRS), and the Public Expenditure Review (PER) to ensure that fiscal governance is in good condition and the country is able to achieve fiscal sustainability for the medium and long term.

 

“It is hoped that it will reduce leakage and eliminate the symptoms of corruption that causes the country to lose a lot of revenue every year.

If the implementation of the new tax or GST is returned, this will surely add to the burden of the people”

he said.

 

Agreeing with the government’s move not to implement new taxes in the near future, however, he thinks that the government should not continue to subsidize bulk, especially the RON95 petroleum subsidy which increases the burden of spending.

 

“Targeted subsidies should be introduced by focusing on the vulnerable and the low income group of 40 per cent (B40).

In order to address the risk of rising prices of goods due to the absence of petroleum subsidies for the majority of the population and traders, direct assistance initiatives to the B40 should be continued so that the impact of the increase in the price of goods does not negatively affect this group”

he said.

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