GST to help balance shortfall in country’s sources of revenue, says Finance Ministry
MELAKA, Nov 3 ― The introduction of the goods and services tax (GST) is expected to help balance the shortfall in the country’s sources of revenue, said Ministry of Finance’s Secretary-General Tan Sri Dr Mohd Irwan Serigar Abdullah.
He said the sharp decline in world crude oil prices has resulted in a substantial loss in revenue for the country but this was mitigated by the implementation of the GST.
“The World Bank and the International Monetary Fund have acknowledged Malaysia’s GST initiative and India has even followed our example by adopting a similar tax system which it also named GST.
“The Saudi government is contemplating doing the same,” he said after officiating the closing ceremony for the Basic Course for Customs Superintendent Grade WK41 and Assistant Custom Superintendent Grade WK29 at the Royal Malaysian Customs Academy here today.
Also present were Royal Malaysian Customs Department (RMCD) Director-General, Datuk Seri T. Subromaniam, Deputy Director-General (Enforcement and Compliance), Datuk Zulkifli Yahya, and Melaka Customs Director Datuk Mohd Noor Yusoff.
Mohd Irwan said in implementing the GST, the government has taken cognisance of the needs and priority of the lower income group by limiting the rate to six per cent, compared to other countries which had a GST ranging from seven to over 20 per cent.
“The government has also been flexible by giving tax exemptions for basic essentials like medicine, health equipment and supplements as opposed to countries where a high GST rate was imposed across-the-board without any exemption.
On Budget 2018, he said, it was a comprehensive plan by the government, involving sectors like agro-entrepreneurs, small and medium-sized enterprises, digital data technology, alongside various segments of society including women, infants to senior citizens.
“The budget does not only lay out the financial planning for next year, it also represents the government’s medium-term plan to enhance the education sector and the long-term plan to realise the National Transformation 2050 programme,” he said.
Meanwhile, he said, RMCD was conducting a comprehensive study of the government’s intention to corporatise the department as announced by Prime Minister Datuk Seri Najib Razak last March, to enhance the tax agency’s service scheme.
He said a detailed study was being done to examine the examples of several countries, such as the UK and Australia, which had corporatised their Customs departments.
Subromaniam said RMCD planned to adopt the zone system of administration to cut costs and reduce dependence on high manpower.
“To-date, RMCD has 15,000 personnel. However, there are still some 700 vacancies for various ranks which have yet to be filled,” he said. ― Bernama