| There were many responses when the Malaysian | | | | 9. Out of inflation pressures, higher prices for goods |
| government first announced the Financial Budget for | | | | & services are sought. |
| Malaysia, year 2010, both good and bad. But when | | | | Prime Minister Mr. Najib has promised Malaysians that |
| they were undecided about GST, it sparked more | | | | they will be tabling a public discussion on GST (called |
| conversation on whether it'll benefit the Rakyat, or | | | | the GST Bill) on December. There are also several |
| further threaten poorer communities in Malaysia. | | | | upsides that could be seen - But until Mr. Najib tables |
| What goods GST covers | | | | the meeting on GST Bill, we shouldn't be skeptical of |
| As proposed by our dear government, GST covers all | | | | anything yet. |
| types of goods & services sold to Malaysian | | | | Other side of the GST story |
| & non-Malaysian residents (therefore consumers) | | | | GST has been said to promise a few things: |
| except for a common commodities such as rice, flour | | | | |
| & sugar. | | | | 1. Implementation will not be abrupt. It will be a slow |
| This goes to mean: Whenever you walk into your | | | | & steady tax preparation so that individuals and |
| favorite hypermarket with the family to get some | | | | small businesses will not be adversely affected. |
| groceries in the future, you will be charged additional | | | | 2. It will replace the 10+5% services and goods tax. |
| ~% (the proposed additional 4%) on top of your bill | | | | This means taxes are lower now - Consumers need |
| except for certain controlled items. | | | | not pay more for one area, but it's divided into many |
| Further, Malaysia's main revenue shouldn't just live off | | | | other source of 'tax' payments. |
| petroleum. In other words, we shouldn't put all eggs in | | | | 3. GST rates are promised at 4%, out of the normal |
| one basket because petroleum revenues have risks | | | | 10% or 5% charged in restaurants. |
| of its own, seeing that it's a natural resource. | | | | 4. Implementation will not occur until middle to late 2011 |
| What reason did they give? More funds for | | | | or 2012. Planning time is essential to not put 'inflation |
| development and expenses. | | | | pressure' on small businesses. |
| How much would they probably get? RM1 billion | | | | 5. Government's coffers will increase. This will enable |
| (RM1,000,000,000) per annum in estimated rounded-up | | | | further development and budget control to the country, |
| revenue. | | | | other than relying just on petroleum or income tax |
| Will it hurt the poor & middle class? | | | | revenues. |
| To a certain extent, it will somehow affect pockets of | | | | 6. Tax when consumed, not when earned is much |
| middle and lower income group Malaysians. | | | | better. It allows better control. Spending influences will |
| The arguments: | | | | be "Careful" and "More controlled" when purchasing on |
| | | | higher prices are made rather than "taxable incomes" |
| 1. Recent price hike in petrol, prices of commodities | | | | generated from work. |
| have increased drastically. And now another one | | | | 7. It's a broad-based tax system. Some items may be |
| called GST? | | | | slightly more expensive & cheaper. It's not a |
| 2. Income tax brackets for high earners aren't as | | | | overall standardized taxation method. |
| 'expensive' as middle-to-low income groups. | | | | Your opinion on GST |
| 3. The Malaysian government has saved | | | | Of course, there are many pros and cons of the new |
| approximately RM2 billion (RM2,000,000,000) by | | | | GST system - And the implementers should look more |
| lowering fuel subsidies - What's the take on GST now | | | | intricately into all income groups, balance their sheets |
| for lower income groups? | | | | and understand what are the effects first. While we |
| 4. GST is tax on SPENDING. Basically, everything from | | | | can only propose so much, there's only so much we |
| parking fees to purchasing mattress. Even with | | | | can do. |
| GST-exempted items, this would still hit lower income | | | | Here are some of the 'preparation techniques' the |
| groups in Malaysia. | | | | tablers of the GST Bill can adopt: |
| 5. Private sectors aren't paying much to Malaysians - | | | | |
| Other more developed countries such as Singapore | | | | 1. Be intricate with details: Tax is a complicated subject, |
| could take this hit because wages & salaries are | | | | like a science of its own. If you make the subject |
| much higher. | | | | complicated, it may lead to more misunderstandings |
| 6. Other countries such as Britain, India, Hong Kong, | | | | and later, more arguments. |
| Japan and Singapore has GST - Doesn't mean GST | | | | 2. Introduce 'layman terms' for further understanding. |
| has to be implemented in Malaysia. Their economic | | | | Giving examples always help. Examples on |
| status and way of gaining revenue varies from | | | | implementations always help. Tell a story to the public - |
| Malaysia. (GST is also called VAT - Value Added Tax | | | | And make it make sense to them. |
| in other countries) | | | | 3. Use other form of publicity media: Tabling the GST |
| 7. Inflation may happen. Prime Minister Mr. Najib has | | | | Bill on national newspapers and mass media isn't going |
| guaranteed no inflation - But with the introduction of | | | | to cut it. Find other means such as introduction |
| GST, the chain of 'passing the cost' will end up usually | | | | campaigns Malaysia-wide. |
| at the hands of consumers. | | | | 4. Engage community understanding: Allow certain |
| 8. Corruption isn't a rare thing in Malaysia - So | | | | private and public (individual or company) figures to |
| businesses has already included 'corruption prices' in | | | | table talks and debates on GST Malaysia-wide. This |
| goods & services. How does that not reflect | | | | encourages engagement and allows more problems |
| additional costs to consumers? | | | | & solutions to be seen. |