KUALA LUMPUR, Nov 26 – UMNO Secretary-General Datuk Seri Ahmad Maslan said the current government may not want high taxes, hence he and assumes that the Goods and Services Tax (GST) will not be reinstated during this COVID-19 situation.

However, he said it can be implemented at a lower rate of 4-5% compared to the 10% Sales and Service Tax (SST).

“The government and the people have to incur huge losses due to tax leaks worth billions of ringgit. SST is as high as 10% and there are two taxes (sales tax 10%, service tax 6%). There is also another issue which is the 10% service charge. GST is just a tax of 6% or less, say something like 4-5% can be introduced. Collection of RM44B in 2017/18 is because it crosses the product compared to SST at only RM21B due to leakage, inefficiency, fraud,  transfer pricing  and others.

“Where is the GST collection spent? Of course, it will be returned to the people in the form of emoluments, development, subsidies, BR1M and others, “he told UMNO Online, today.

He said, in 2020, the government will have less revenue of RM42 billion and it is certain that if there is GST, RM44 billion can help. “That is one of the reasons why the PH-DAP regime has been ridiculed almost every day for 22 months.”

In this regard, he who is also the Member of Parliament for Pontian and was once called ‘Tok Mat GST’ agreed that the implementation and explanation of GST must be accurate and enforcement must be effective, especially on the price of goods and economic sabotage by unethical traders.

“For example, roti canai cannot rise in price for flour is zero rated, cooking oil is zero rated, cooking gas is zero rated too. Teh tarik is … water pipes is zero rated, milk, sugar and tea too. There shouldn’t be a price increase.

“Fish, chicken, beef, mutton, rice, vegetables, fruit, flour, noodles, seafood, and raw foods are almost  zero rated. GST Malaysia is special, unlike 170 other countries. Furniture, cars, mobile phones, clothes, shoes, balls, makeup, construction items and others now have 10% SST. If they are under GST, we should throw away 10% instead of 6%, and the price will drop by 4%. Not a permanent 10% SST plus 6%.”

Strictly speaking, he added if it rises by 16 per cent, then the calculation is wrong.

“Deliberate miscalculation is the reason for some to take advantage of it. If we ask traders, they will honestly say they prefer GST because the rate is low and there is a tax refund that helps reduce business costs. SST has no tax refund element or tax credit input. Business is well-organised because everyone must have receipts, invoices, bills and others,” he added.

Earlier, Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz was quoted as saying that apart from reintroducing GST, the government was also examining the appropriate new taxes and a study on taxes involved had been carried out by a special committee that had been set up.