KUALA LUMPUR: The Goods and Sales Tax (GST) is far more effective and less of a burden than the current Sales and Services Tax (SST) implemented based on the Madani government's own fiscal outlook report for 2024.
Ayer Hitam member of parliament Datuk Seri Dr Wee Ka Siong made this assertion in a video posted on his Facebook page earlier today.
In his five minute and 39 second video, Wee pointed out the five comparisons made between the SST and GST that can be found in the Finance Ministry's official Fiscal Outlook and Federal Government Revenue Estimates 2024 report.
Reading out points from the table in the report, Wee listed out the numerous apparent benefits of the GST over SST that include SST being less transparent.
"SST: Multiple effects occur when the tax component is part of the cost at each stage in the supply chain. At the same time, the overlapping of two separate and overlapping tax systems can result in double taxation because goods may be taxed twice.
"SST is less transparent to consumers because taxes can be hidden in the prices of goods and services.
"GST: There is no double taxation effect because taxes on inputs can be claimed and are not part of the cost. GST is more transparent to consumers because taxes are clearly shown in the final prices of goods and services," he said.
Wee continued to touch on the other comparisons raised in the report, pointing to that SST is only imposed on certain goods and services, leading to issues in the classification of taxed goods or services.
He added that the SST mechanism can contribute to compliance issues and encourage tax evasion.
Whereas, the GST mechanism is more transparent and can encourage compliance and reduce tax evasion.
Wee then hinted that based on the comparisons made, he first thought the study was from the pro-Najib, pro-GST camp. But, evidently it wasn't the case.
"At first, I thought this comparison was a study from those who are pro-Najib, and pro-GST– once upon a time ago, because almost all of the comparisons made are for GST. Then I looked at the cover of the study. Take a guess, who do you think made this comparison?" he insinuated.
"This is the Fiscal Outlook and Federal Government Revenue Estimates 2024 report that was published by the Finance Ministry under the Madani government.
"This is what puzzles me; the Madani government came up with this study and look…on page 17 is where you can find the comparison between SST and GST which is almost all for GST.
"My question is why not implement GST if it is better and can be more beneficial to Malaysia's economy?
"Why and 1000 'whys'?" he said.
"In summation, I would like to beg the government to please think it over. This is for the good of the people. Do the right thing. This is not a question of saving face. Forget the past and move on. If the government's official fiscal report says that GST is far more effective, and is considered unmatched, then do the right thing and walk the talk.
"I believe there is convincing justification to keep GST in place. But what is odd is that despite the GST being praised in this report, why is it not implemented?
"Odd, odd, odd," he said.
Wee also highlighted that back then, SST was said not to be burdensome on the people because it does not have as wide a scope as GST. But now that the scope for goods and services under SST has been expanded, it prompted even the former Finance Minister Lim Guan Eng, who insisted on doing away with GST and to re-open the way for SST, to admit that the current SST regime is getting more burdensome and has asked to revise the hike rate of SST.
This, Wee added, has left the people stuck and caught in the 'cascading effect' from increasing prices of goods.