Just a few days ago at THIS LINK, Deputy Finance Minister Chor Chee Heung announced that Malaysia will see a gradual reduction in its corporate and income tax rates once the proposed Goods and Services Tax (GST) is in place by mid-2011.
The report said:
"This is a long-term objective of the government. Once the GST come into play, it will be a broadbased tax and the trend is, once GST is implemented, corporate and income taxes will gradually be reduced," he said here Thursday.
Speaking to reporters after officiating the PTD (government administrative and diplomatic sercie) Alumni Policy Dialiogue on the GST, he said, however, he did not think there was a timeline for achieving this reduction in corporate and income taxes.
Chor also disclosed that businesses related to services such as those in the food and transportation sectors, would be exempted from the proposed GST. He also assured that the cost of living and lifestyle of the people would not increase or be affected with the implentation of a GST.
The implementation of GST would not cause inflation either, he said, adding: "Once the GST is in, the service tax and sales tax (now imposed) would be abolished. Both taxes are quite high at 10 per cent and five per cent respectively. The GST at four per cent is considered very low." CLICK HERE to read more.
The GST Bill was tabled for its first reading in Parliament last December. The second reading will take place during the parliamentary session beginning later this month.
This evening at 8.00pm, PAKATAN RAKYAT PULAU PINANG will be holding a FORUM ON GST that will feature YB Tony Pua (MP PJ Utara, DAP, YB Dr. Dzulkefly Ahmad (MP K. Selangor, PAS) and En. Mohd. Rafizi Ramli (CEO of Selangor Economic Advisory Office). The forum will be held at Penang Caring Society Complex, Jalan Utama (Next to Governor's Residence). If you are in Penang, please come for this meeting to know more about GST and how it will affect you.
I am no economist but from what I have read and studied, I thought I'd share a few basic points to get us ready for GST in Malaysia.
What is GST? GST is a tax on spending that will cover all types of goods & services sold to Malaysian & non-Malaysian residents (therefore consumers) except for a common commodities such as rice, flour & sugar.
How will it affect you? In future, whenever you buy something or pay for a service (even parking fees!!!), you will be charged additional ~% (the proposed additional 4%) on top of your bill except for certain controlled items.
The rationale: More funds for development and expenses.
Estimated revenue: A whopping RM1 billion (RM1,000,000,000) per annum
Will inflation occur? Whether you like it or not, the reality is that it will affect the pockets of middle and lower income group Malaysians. Please do not forget that even without GST, the cost of living in Malaysia has increased. The prices of petrol and commodities have escalated and we are going to have GST? Our PM and Deputy Finance Minister have said that inflation will not occur. Let's be realistic. With the introduction of GST, the chain of ‘passing the cost’ will end up usually at the hands of consumers. And what will that mean? Do your mathematics and reach your own conclusion. Along the way, think of those who are poor - the unemployed, the handicapped, single parents, the elderly etc.
What about implementation? There will be a slow & steady tax preparation so that individuals and small businesses will not be adversely affected. Implementation will not occur until middle to late 2011 or 2012.
GST will replace the 10+5% services and goods tax. This means taxes are lower now – Consumers need not pay more for one area, but it’s divided into many other source of ‘tax’ payments.
GST rates are promised at 4%, out of the normal 10% or 5% charged in restaurants.
If you want to know more, come and hear it from the experts tonight at 8.00pm, Kompleks Penyayang, Jalan Utama, Penang.
In closing, here's a poem that was sent to me via email re the GST. You may laugh at it now but I foresee the situation will be much worse in Malaysia when the GST is implemented!
REFLECTION OF A TYPICAL SINGAPOREAN
I am Ong Ah Tee living in Kampong Chai Chee
Life used to be simple and HAPPY
I worked hard in my STUDY
I learned A-B-C, and everything from 1, 2, and 3.
Primary school was quite easy I passed PSLE
Then I went to SECONDARY
The subjects include HISTORY, GEOGRAPHY
Physics, Biology and CHEMISTRY
After O levels I went to JC
They said you live in Singapore very LUCKY
This is a small humid tropical COUNTRY
Surrounded by unknown potential ENEMIES
Boys turned 18 must go to ARMY for the tour of duty
After that we may continue our Studies
The girls can just sit back, relax, and watch TV
They come to this world only to "lim kopi, kway jit chee
No one lives on free meals or depends on CHARITY
I want to take up IT, but I had no money to go to University or Poly
So I went to work at FACTORY
Working hard to earn a little lousy SALARY
After CPF and INCOME TAX, I have just enough money to buy ROTI and ride in MRT.
My bosses show me no SYMPATHY
Mumbling over my shoulder daily: "HURRY, HURRY and HURRY !"
Accusing me of always trying to get MC
But my sickness was due to over stretch OT
Going home after midnight by TAXI
And they pay me only bus fee
My colleague likes me because of my honesty and can easily bully
They said I don't know how to carry.
I Park-Tor and became STEADY
Finally had to MARRY
Because gahment gave baby bonus MONEY
I lost money holding Wedding Dinner PARTY
Cheeky friends donating only cheap PANTY
After marriage, nothing was EASY
In one year, I became DADDY
I can't support my family and our BABY
Being tied down for life to repay 2 rooms HDB and rising monthly
utilities to PUB
My bank account has NO MONEY
POSB balance is almost EMPTY
DBS wants to charge me EXTRA FEE
Insisting that "Nothing is FREE!"
So I moonlight as KARANG GUNI
Many times I want to jump MRT
But that is not EASY
My wife cries: "Who is going to support me and our BABY?"
So I can't MATI
I went to seek assis tan ce from the MP
His reply was simple and easy
"Vote for me, vote for me, vote for me".
He never tells me any convincing Policy.
How to help the poor with more GST?
Why I cannot have pay increase but they can have increase?
Before, my MP said "Vote for me, we give you sweeties".
Now, they want to increase salary, because "You voted me"..
They claim they made good economy for our country.
They benchmark themselves using GDP.
They said, "To get the best man, you have to pay high fee"
otherwise, they will join MNC. /
And all your 'char bor' become maids in other COUNTRY.
Next will be the GST.
My boss say "no" to increase in salary,
It's really make me worry.
Our Health Ministry said let GP set their consultation fee.
If the GP charges high fee, don't let them see.
No money, how can healthy
If fall sick, can only mati
In hospital, can afford Class C.
I don't mind all nurses are aunty,
But only one doctor to see
No money for operation, I Tan Si.
Do you think GST will benefit Malaysians? Do leave a comment if you wish to share your views about GST.Thanks! Have a nice day!
Anonymous "WHAT DO YOU KNOW ABOUT GST IN MALAYSIA?"
What is there to know?
Except as a "GO SQUEEZE THEM" thing and BS excuse by a wastrel and rapacious Gomen.
~wits9~