Govt open to study on integrating GST, SST

Malaysian Prime Minister Anwar Ibrahim disclosed today that the government is open to exploring the possibility of studying the integration of aspects from the goods and services tax (GST) with the sales and service tax (SST). Speaking to reporters after discussing the 2027 federal budget, Anwar, who serves as both Prime Minister and Finance Minister, expressed his support for the idea as a means to establish a more progressive tax system.

However, he emphasized that imposing a broad-based tax on all Malaysian citizens is not on the table at the present time.

Anwar reinforced his prior concerns regarding the introduction of additional taxes, stating that it would burden individuals already struggling to cope with the escalating cost of living. The proposed GST, initially implemented at a rate of 6% in April 2015 and later suspended in June 2018, has been deemed more efficient by some, but Anwar fears that it could impose a financial burden on those who have not previously paid taxes.

In response to the observed rise in living expenses, Anwar suggested that the SST could serve as a foundation for any necessary adjustments, should the government decide to explore the integration of GST elements with SST. The finance ministry has consistently rejected calls to reintroduce the GST, citing the requirement that Malaysia's median wage surpass RM4,000 before considering such a measure. Currently, the national median monthly wage is approximately RM2,800.