Govt open to GST features in SST as experts see potential to plug tax gaps
PUTRAJAYA: The government is open to incorporating selected Goods and Services Tax (GST) features into the existing Sales and Service Tax (SST) to strengthen revenue collection without imposing a broad-based tax on Malaysians already facing cost-of-living pressures.
The Malaysian government is considering integrating certain aspects of the Goods and Services Tax (GST) into the existing Sales and Service Tax (SST) system to enhance revenue collection without burdening Malaysians already facing cost-of-living pressures, according to Prime Minister Datuk Seri Anwar Ibrahim. The government remains committed to the SST as the foundation of the tax system but is open to exploring GST features that could improve efficiency and revenue collection.
Experts suggest that incorporating the input tax credit (ITC) mechanism from GST could address weaknesses in the current SST system, particularly for business-to-business transactions. However, concerns exist about potential compliance costs for businesses and the risk of further financial pressures for SMEs if implementation becomes burdensome.
The government has repeatedly dismissed calls to reinstate GST but may reconsider if Malaysia's minimum wage surpasses RM4,000. SMEs prefer GST over SST due to its ability to prevent tax cascading, but they caution against adding significant compliance burdens.
Written by urgent.news from New Straits Times's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
