Monday, May 20, 2013

PKR slams GST proposal

PKR trade and investment bureau chief Wong Chen has called on the government to do away with unnecessary mega projects and corruption before introducing the Goods and Services Tax (GST).

Rebuking Minister in the Prime Minister’s Department Idris Jala for proposing a 7% GST, he said Malaysia can avert a major financial meltdown, if the government eliminates mega projects and weeds our corruption.

He said this in reaction to Idris’ statement recently that the government was mulling the implementation of the GST at 7%, similar to Singapore.

The minister also said the 7% rate would increase government revenue to about RM25 billion a year.

Wong, who is also Kelana Jaya MP, said the country’s economic woes was caused by a weak tax base, profligate spending and unabated corruption.

He said about 78% of the population fall under the non taxable category earning less than RM2,500 a year.

“Introduction of the GST would be an added burden to the people. It is not tax evasion. People just do not make enough money to pay tax,” he added.

On the argument that government would reduce corporate and income tax to facilitate the implementation of GST, Wong said this would only benefit the rich as the poor would end up paying more.

“In essence, the government’s GST plan is regressive in nature unless they can cut on excessive spending and corruption… BN has no right to introduce GST,” he added.

Wong said the 7% GST proposed by the government was too high and would in return spike the nation’s inflation.

“The minister’s figure is not the same as the Finance Ministry’s proposal which wanted 4% GST. In 1994, Singapore introduced GST at a low rate of 3%. It took them nine years to increase it to 4% in 2003 and subsequently to 7% in 2007,” he added.

“So if the minister loves the Singapore model so much, would he commit to a 3% GST rate for nine years if there is a real need to implement the new tax system?” he queried. -FMT

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  1. The GDP was expected to record a growth of 4.5 per cent to five per cent supported by strong domestic activity, as well as, accommodative fiscal and monetary policies

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  2. In ensuring sustainable growth and social progress, Prime Minister said the government would be prudent in its financial management and was committed to reducing the deficit and debt levels over the medium-term.

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  3. These measures include the further developing of human capital, improving rural basic infrastructure especially in Sabah and Sarawak, spurring domestic investment, strengthening the public-private partnership, as well as, increasing productivity and innovation.

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  4. Investment in the education sector was among the huge focus by the government throughout 2012 in efforts to generate human capital excellence, creativity and innovation, whereby a sum of RM50.4 billion was allocated for the sector.

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  5. RM4.6 billion was provided for the building, upgrading and maintenance of school facilities as well as non-physical projects such 2012/2013 Economic as computer systems, furniture and fitting involving 1,969 projects of which 523 had been completed.

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  6. A special fund of RM1billion was also allocated to cater for the immediate needs of public schools, whereby RM100 million each was allocated to 822 national-type Chinese schools, 224 national-type Tamil schools, 428 mission schools, 167 Government-assisted religious schools and 32 Maktab Rendah Sains Mara (MRSM).

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  7. All school fees were also abolished and the government would bear the cost of insurance premiums for all students of public funded schools which involved an allocation of RM150 million for the benefit of more than 5.3 million students nationwide.

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  8. The government had also recently launched the Malaysia Education Blueprint, which contained views, recommendations and feedback, to further enhance the country’s education system.

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  9. the government had also provided double deduction incentives for expenses incurred in the implementation of training programmes by companies, effective until 2016.

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  10. As of August, the report said, the incentive had attracted more than 100 Malaysian companies to participate with more than 3,000 Malaysian students and 2,000 Malaysian professionals involved.

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