The government has no plan to re-introduce the Goods and Services Tax (GST) at this moment, Prime Minister Tun Dr Mahathir Mohamad said today.
He pointed out that his previous statement on GST has been taken out of context leading to the assumption that the government would consider bringing back the tax regime.
“We (the government) have not discussed it yet.
“The matter (on whether the government will consider bringing back GST) was asked by reporters.
“I answered (by saying that) if this is the request of the people, and as we are sensitive to the wishes of the people, we will study (the request).
“No study has been carried out, and since I made the statement, there has yet to be a (Pakatan Harapan) presidential council meeting,” he told reporters at the Parliament lobby today.
On Thursday, Dr Mahathir was reported as saying that the government would consider studying the re-introduction of the GST if the people believed it to be better than the current Sales and Services Tax (SST).
However, Finance Minister Lim Guan Eng in response to this said there must first be “incontrovertible” evidence that the people wanted GST back.
After coming to power in May last year, Pakatan Harapan repealed the GST Act in August, replacing it with the sales and services tax that came into effect the following month.
GST is widely seen as a more efficient consumption tax system, but PH campaigned hard for its abolition in the run-up to the 14th general election.
The new government then reinstated SST in September last year, with tax rates varying from 5 per cent to 10 per cent.
GST had contributed RM44 billion annually, while the Finance Minister had projected in July collection for 2019 to amount to RM22 billion.
This government said this was because the GST covered a wider scope of items, while fewer things were taxed under the SST.
The government has claimed the new tax system burdened the public less as people were taxed less.
Earlier report: Oct 3, PM: We Can Consider Bringing Back GST if People Want It