Economy minister Rafizi Ramli says the government is not ruling out the reintroduction of the goods and services tax (GST). Although the country’s priority was to roll out the capital gains tax next year, he said that other forms of taxes, including GST, will be considered in the effort to widen the nation’s revenue base, The Star reports.
“We will be open and go through whatever way we can to achieve fiscal sustainability through a wider revenue base – whether is going to be capital gains tax, GST or any other forms of direct and indirect taxes,” he told reporters following the tabling of the 12th Malaysia Plan (12MP) mid-term review in parliament today.
“One of the strategies to widen our revenue base is to develop and roll out capital gains tax in 2024, and the government will stick to that strategy,” he said. As for other potential avenues of revenue collection, these remain open. “We will decide on a case-to-case and year-to-year basis,” he said in response to a question about whether the government had plans to revive GST.
Rafizi added that any announcement with regards to any introduction of a new tax or revenue stream would be made by the finance ministry from one budget announcement to another.
Last week, MCA president Datuk Seri Wee Ka Siong called on the government to bring GST back, as many businesses were reportedly dodging taxes under the present sales and service tax (SST), resulting in reduced revenue for the government.
Wee said that the GST could be revived with several improvements, such as the introduction of an exemption list, zero-rated supply and giving financial aid to the poor with increased government revenue. He also suggested that the reintroduction be made at a lower rate and increased over a period of time.
The GST replaced the sales and service tax (SST) in April 2015, but was then scrapped in favour of bringing back SST in September 2018 when the Pakatan Harapan government took over the reins.
In March this year, prime minister Datuk Seri Anwar Ibrahim had reiterated that Malaysia would not reinstate the GST or any other broad-based consumption tax in the near future. He said the country was simply not ready for the reintroduction of GST, with the rakyat‘s income and threshold first needing to be increased and at a reasonable level before the tax could be reinstated.
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