12-9-2023 (KUALA LUMPUR) Economy Minister Rafizi Ramli has indicated that the possibility of reinstating the Goods and Services Tax (GST) remains an open consideration. While current plans are primarily focused on the introduction of a capital gains tax in the coming year, the government is willing to explore other forms of taxation as well.
Rafizi highlighted the strategy to broaden the country’s revenue base by focusing on implementing the capital gains tax in 2024, a plan the government intends to stick to. However, he emphasized the government’s openness to various approaches for achieving fiscal sustainability through increased revenue, including potential options such as the GST or other forms of direct and indirect taxes.
He stated, “I prefer to keep that strategy open. We will decide on a case-to-case and year-to-year basis.” Rafizi made these remarks during a press conference following his attendance at the presentation of the 12th Malaysia Plan Mid-Term Review (MTR) in Parliament.
Rafizi’s comments were in response to inquiries about whether the government intends to reintroduce the GST as part of the 12th Malaysia Plan. Last week, MCA president Datuk Seri Dr. Wee Ka Siong proposed the reintroduction of the GST with specific enhancements, including the establishment of an exemption list, zero-rated supplies, and financial assistance to low-income individuals using the increased government revenue.
This suggestion garnered support from several economists who emphasized the need for clear mechanisms if the GST were to be reinstated.
During the MTR presentation earlier in the day, Prime Minister Datuk Seri Anwar Ibrahim underscored the necessity for fiscal reforms to ensure sustainable and effective management of the country’s finances. He also assured that the government would not impose taxes that would burden the people beyond their means.
