Malaysia: Harapan disagrees with PM’s proposal to reintroduce GST

  • Pakatan Harapan has disagreed with the reintroduction of the Goods and Services Tax (GST) as it will lead to a sharp increase in consumer goods prices.
  • In a statement on 1 Jun 22, the opposition coalition reminded the government that the majority of Malaysians had rejected GST, as shown in the 2018 general election.
  • “The reintroduction of GST will lead to a sharp leap in prices of goods. This will cause tremendous pressure on the people if they also face a stagnant wage coupled with the supply chain issues,” it said.
  • Harapan said it was inappropriate for the government to think of collecting more taxes from the people when it had not rectified governance issues following the 1MDB scandal.
  • “There is no point in collecting more taxes if the taxpayers’ money is eventually squandered due to corruption, leakage and cronyism,” it said.
  • Harapan drew the conclusion based on the country’s ranking in the Transparency International Corruption Perception Index, which dropped five spots to 62 out of 108 countries, as well as The Economist’s Crony-Capitalism Index, which placed Malaysia in the second rank after Russia.
  • “The prime minister should be reminded that the majority of Malaysians had rejected GST in the last general election. Therefore, Harapan disagrees with the GST reimplementation proposal as long as these issues continue to plague the people,” said Harapan.
  • The statement was jointly endorsed by PKR president Anwar Ibrahim, DAP secretary-general Anthony Loke, Amanah president Mohamad Sabu and Upko president Madius Tangau.
  • Meanwhile, DAP secretary-general Liew Chin Tong said he was stunned that Ismail Sabri and former prime minister Najib Abdul Razak pushed to bring back GST amid a global rise in inflation.
  • Liew pointed out that if the GST was a silver bullet for an economic boom, the economy would have surged between 2015 and 2018 when the tax was in place.
  • Liew said the promoters of GST have argued that Malaysia’s tax base is too small, and there are too few Malaysians – only around 16.5% – subject to individual income tax, and therefore, by implementing GST, the tax base will expand, as everyone will need to pay GST whenever people purchase any goods or services.

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